Melissa Thomas, Nycomed UK Ltd.
Release Date: 2010-11-26
Can you describe the evolution of Nycomed in the UK?The changes that are emerging in the UK pharmaceutical market are a hot topic currently, but the overriding view within Nycomed UK is that, despite the fact that everybody has an opinion, nobody quite knows what will actually happen. Unless you have a crystal ball, what we are seeing at the moment is a lot of conjecture about how the new NHS will bed down post the restructure. What we do know is that there is going to be significant change but we have to be careful not to make the wrong move at the wrong time. Nycomed UK is no stranger to change and has undertaken a number of restructures in recent years. Whilst these changes have been the right decision for the business, such activity is costly both from a resource, and a time perspective.
In the past these changes have been driven by a variety of events. One such event is loss of patent—you may be aware that we lost patent on Protium, which was our biggest product in the UK two years ago As with most companies, we have also been affected by factors such as structural changes in the NHS: the willingness to pay both nationally and locally and other restrictions put in place by PCOs and other similar bodies who are facing their own challenges. The result is that the marketplace has been getting ever more difficult and we have had to respond accordingly.
The last major change happened at the end of 2009. During last year we built up for the launch of Daxas, but it became clear that we did not have the ideal infrastructure or respiratory heritage to launch this product optimally. Therefore, a decision was taken to out-license Daxas in the UK to MSD. That was the right decision for Daxas, and it was the right decision for Nycomed . Ultimately, you need to know when you can make something a success, and when you need to look at a different business model.
Once the decision was made, we needed to consider how we would operate in the UK market going forward. We are a small business with a small portfolio of products which is driven by our commitment to only bring medicines to market that truly add value to the local health economy. We decided, therefore to go back to basics and complete a strategic review of our whole business.
The outcome is a new business model that we are just in the process of implementing. At the end of October, we disbanded our existing sales organization and replaced it with three commercial directorates. Our goal is to have a small core business of highly experienced, talented people who have full P&L responsibility across the portfolio.
These core teams are responsible for developing strategy, building plans, and implementing these plans to the point of momentum. Once momentum is achieved in a geographical area, they then bring in flexible resources to manage effective pull through. This means that despite containing the organization as a small, lean, core team we have the capacity to bring in additional resource when we know something is working, Ultimately we are looking to deliver profitability in a market that now requires us to be far more responsive to customer needs and the economic environment. There is no point working where our customers see no value in what we do.
Globally, the Group’s revenues have been quite challenged. How has Nycomed UK faired?
In the UK our revenue has been severely challenged, due to the loss of patent on Protium. Anybody who works in the UK market knows that, whilst in some countries you can develop LOE strategies to deliver a gentle decline, you can rarely achieve this in the UK. We knew a long time ago that the revenue was going to go down significantly and it has—that is no surprise to us.
Nycomed UK has now reverted to being a specialist company and seeks to work in areas where we can become experts; we are looking for products that truly add value. This is the key point. We do not bring the whole Nycomed portfolio to market just because it is there. One of our key maxims is bringing medicines to market that matter. When an opportunity emerges we ask ourselves ‘Is this product needed? What value does it add to patients or to the NHS?’ If we cannot answer this question the answer is obvious to us.
The sort of products that we will bring to market are the kind that fill an unmet need, or are a significant improvement—for whatever reason—over what has been available historically. Our model then allows us to develop and implement a bespoke resourcing plan that optimally fits the need of the product as opposed to having to fit in with a pre existing infrastructure.
An example of such an approach is with our fentanyl patch Matrifen. Whilst we could have handled this ourselves we have chosen to distribute through TEVA pharmaceuticals in the UK. They are experts in branded generics and hence the partnership between the two companies has resulted in the optimum solution for Matrifen.
How do you position yourself in the UK market, given your new structure?
During 2010 we have kept a fairly low profile whilst our focus has been on building the future proof and sustainable organization that we will launch in 2011. An analogy for this is that we have been in a tough market, and historically every time a big wave comes, we have the potential to be knocked over. The idea of the new model is that in future we will surf! We now have something that is flexible enough to allow us to say, ‘This is working, this is worth doing. Let us expand.’ If it is not working, we pull back in, and go in a different direction. In 2011, therefore, we aim to profile Nycomed UK as a lean, flexible organization that responds to the needs of customers and the NHS environment that we work within.
Europe is still the biggest market in Nycomed. We have an executive committee who are completely clear: Europe is important, emerging markets are important. But what you do in those two markets will be different. We have seen intense cost pressures across Europe and our role is to understand the reality within which we work. That is not about Nycomed, it is about the pharmaceutical industry generally and we all need to find new solutions to ensure that we can operate efficiently and successfully in our respective marketplaces.
I have already described our response but in some respects the UK has the advantage, because changes have historically happened here first. We have seen the writing on the wall for longer than other parts of Europe. Although we cater to a small market in the UK, we know we are strategically important to Nycomed. Having said that the expectations in the UK are not what they would have been years ago, where you would expect high revenues and high growth. Now it is about sustaining a profitable presence, and an influential presence, and that is what we seek to do.
What therapeutic areas do you see as having the most potential for your future expansion in the UK?
Whilst we do specialize in specific therapeutic areas our approach as stated earlier is to look for products that add value. We would consider any products that complement our model either in terms of our current portfolio or because they fit the approach of working with specialist and perhaps even niche products. I am not saying that we would never look outside of this, but it comes back to our mission to really add value to the UK patient and NHS. There is a lot of competition out there for new molecules and we believe our new model is an attractive proposition for companies seeking an out licensing partner. We will build the infrastructure that is right for each molecule so that every one receives the optimum level of focus within our portfolio.
What attracts your employees to Nycomed UK?
Nycomed has a very strong set of values that are lived across the business. You can go into any part of Nycomed globally, and you will feel them. In the UK we spent a lot of time thinking about the skills and competencies that we need; and then, the opportunity that exists for the right-minded individual.
We are very honest about the sort of personality that we believe will thrive in this environment. We have a very candid message regarding the fact that this is not for everybody. One of the things that we talk about in our recruitment is the appropriate level of ego. We do not want people whose main driver is status. In this model, we want people who can operate at a very senior, strategic level—and can roll their sleeves up and excel at operational implementation. This philosophy runs throughout our business.
In terms of compensation, we are competitive but if someone is overly focused on the size of their car or office this is not the environment for them.
In a similar vein we are all customer facing. If I am needed to go and speak to a customer on any level, I welcome that opportunity and this applies to all roles in the organization.
Undoubtedly recruitment is key. We outsource a lot of functions in this business, by virtue of our size. For example we outsource HR, regulatory, supply chain and recruitment. We work widely with partners. We find companies that share our values, share our beliefs and are passionate about what we are trying to achieve and work really hard to deliver our goals with us. In terms of recruitment we have built a process that seeks to give prospective candidates the very best experience. The minute a candidate expresses an interest in a Nycomed role, they receive a candidate pack that talks about the vision, the values, the market, Nycomed locally, and Nycomed globally. Initial interaction is with our chosen recruitment partner VMC, but this partner is so aligned with our culture that candidates feel as though they are talking directly to Nycomed. We put everybody through a very rigorous assessment program, but within that we build in time for candidates to assess us. Throughout that process—from the outset, to the moment we either offer or regret them—we apply the same value driven approach and the feedback that we have received has been fantastic. Even candidates, whom we have not employed, have taken time afterwards to complement us on their experience. The result? Well despite being a small company we are attracting some truly excellent candidates.
What does Nycomed look for, in partnering with another company?
We look for companies with similar values, and a similar business approach. Our recruitment partner worked with us for a year, to reestablish our whole approach to assessment and recruitment, and they did not know at that time whether they would get any business out of it at all. They walked with us, and they worked with us, and now they are our lead recruiter.
We have a similar relationship with our other partners and this makes for sustainable arrangements from which both parties benefit.
What has been most rewarding for you in this position, and what do you feel you have brought to the company?
I am relatively new in this position although I have been with Nycomed for nearly 8 years. Throughout that time Nycomed has provided numerous opportunities to expand the breadth and depth of my experience. It really is an environment where the opportunities are there for the taking! The aspect that I am most proud of in 2010 is that as a new team we have quickly and effectively developed and implemented a new model that will allow us to remain strong in the years ahead. It would have been easy to wait and see how the new NHS pans out but we chose to be proactive and make the changes now so that we can respond more rapidly as the future NHS becomes clear. It has been immensely rewarding to lead the organization through this process.
The waves are going to keep hitting us, but in a changed and changing reality, we believe that our new model will allow us to succeed.
We are going into 2011 with something that is fit for purpose and sustainable. It will allow us to deliver on short-term goals, in terms of revenue and profit. Furthermore the model will actually give us something to grow with even if that growth is not what we saw over the last couple of decades.
Where do you see the company going in the next two years?
We will have achieved organic growth from the products in our portfolio, by investing where we can win. We do not need to have a national footprint in the UK. For example the significant growth that we are seeing with Matrifen currently is coming from about 25 PCOs around the country.
We want to replicate that success, and develop a unique model for all of our products. I want us to have a candid discussion with NHS customers that says, ‘If this is not what you are looking for, then that is fine. Let us not waste each other’s time. Let us find something that does work’
In two years time, I would like to be in a position where we will replicate flexibility across every product in our portfolio so that we are approached by companies who want to work in partnership with us. Within this period, we will be able to demonstrate a strong base of tangible success so this is a realistic goal.
What is your final message to your peers, the international readers of Pharmaceutical Executive?
Despite the challenges that exist in the UK market, success is still possible, and we will deliver that success. The direction that Nycomed is taking is compelling. For me, as a European country head—I am delighted to see my company investing wisely to drive growth for the future even if that means taking a different approach in Europe.
What we can do now is play our part in making sure that Europe is strong, and remains strong because Europe is a huge market, and always will be. We have to think differently, and be honest with ourselves and say, ‘The world has changed.’ At Nycomed UK, we are ambitious, but we are realistic as well. As a young company, we have a real buzz in this building, which I want to share with the rest of Nycomed, and the rest of the industry in the UK. But I want to share it when we have shown what we can do.
| Company: | Nycomed UK Ltd. |
| Position: | Managing Director |
| Country: | United Kingdom |