Published in 1997, Clayton M. Christensen’s “The Innovator’s Dilemma” attempts to get at the heart of a conundrum faced by organizations in any number of industries. Company leaders realize that their longer-term survival hinges on continuous self-reinvention, yet the same processes and habits that have made companies successful often stand in the way of true innovation. “The Innovator’s Dilemma” became an immediate sensation upon release and has since joined “The 7 Habits of Highly Effective People,” “The Tipping Point” and “How to Win Friends & Influence People” in the modern canon of business books.
Like companies in other verticals, drug and diagnostic makers have contended with this particular issue for some time. It’s been compounded by a factor unique to pharma: Owing in part to the industry’s strict regulatory guardrails, there’s often limited appetite for true, boundary-breaking innovation. In too many instances, innovation is reduced to an exercise in brand-planning, only to be watered down later in the process. The tell-tale questions – “Has this been done before?” and “Are we sure it will work?” – often have the unintended (or, for the cynics among us, intended) consequence of stymieing the very innovation that is contemplated.
It doesn’t have to be this way. The antidote for these concerns, specifically in pharma, is to create and cultivate a core foundational and company-wide competency for innovation, one that helps companies drive a spirit of experimentation throughout their organizations – and, in the process, chip away at decades worth of risk-averseness. To that end, they need to formalize their in-house innovation function. In many cases, that means appointing heads of innovation, individuals who are empowered to work across groups and remove internal barriers to change.
This type of position barely existed when I joined Biohaven in 2021 as head of go-to-market innovation for Nurtec ODT – which is partly why it was so appealing. I viewed the role as a clean sheet of paper, fascinating and ambiguous in equal parts. And that’s what made it such a challenge: There was no “how to drive innovation at a company that makes medicines” user manual or blueprint. Despite the unwavering support of the people who hired me – specifically, BJ Jones, then Biohaven’s chief commercial officer, and Graham Goodrich, then SVP, marketing – I basically had no idea what I was doing for my first three months in the role.
My eureka moment arrived when I realized that there would be no eureka moment. The gradual understanding that I would not arrive at a tried-and-true approach to innovation – and that a perfect plan was unlikely to take hold, either within my own organization or pharma writ large – became extremely liberating to me. Instead, I chose to focus on identifying the biggest challenges facing the Nurtec team and the opportunities that eliminating them could unlock.
A good example of this would be our efforts to create a pseudo Nurtec e-commerce platform. Social media and other drivers were directing considerable traffic to our website, yet the engine wasn’t designed to advance those visitors through the adoption continuum or to convert those visitors into customers.
The culprit? The platform itself. While more effective than most pharma brand websites, it only offered a few down-funnel opportunities: To download savings cards and to use a provider finder (an outdated one at that) to search for nearby physicians. What it didn’t offer was a fast, easy way to get Nurtec into the hands of people dealing with debilitating migraines. Those types of solutions were becoming more common among CPG companies, but rarely surfaced within the highly regulated pharma/biotech space.
My team revamped the e-commerce platform by introducing multiple telehealth options, an AI-based chatbot and even live nurse support. Slowly but surely, conversion rates improved. It taught me the first rule of in-house innovation: Do not be so dogmatic about introducing innovation that you fail to give the customer multiple solutions. Innovating a better web experience to even modestly improve conversion rates (and, of course, help frustrated migraine sufferers) made a significant difference to the bottom line mainly because we understood that not every customer was looking for the same thing.
This, in turn, revealed another learning: Not every hit has to be a home run. Knowing the potential financial impact of an increase in conversion rates via the Nurtec e-commerce platform certainly helped sway some of the non-believers, but more important was the shared understanding that nothing would be an overnight success. The only true way to achieve an objective in this space is to continually optimize through a test-and-learn approach.
In this scenario, the organizational appetite for innovation tends to go up. Why? Because the key metric is improvement, not necessarily immediate success or failure.
Speaking of non-believers, the medical, legal and regulatory arms of pharma companies often make for an easy scapegoat. You’ve heard the major complaint over and over again: They supposedly exist to say no to anything and everything different that crosses their paths, whether a digital marketing initiative or a novel approach to reaching customers. Thus it’s assumed that they’ll be cold to most innovation-minded efforts, which by definition are new and untested (and thus require more diligence).
At Biohaven, we found such hyperbole to be just that. Yes, it will always be MLR’s responsibility to assess products and programs from every conceivable angle and to identify the risks that come with it. But by bringing them into the loop at the start of our innovation endeavors, we made them partners in the journey. Doing so did not necessarily remove risk from the equation, but with ample time to discuss and assess, MLR groups never felt that anything was being sprung on them. As a result, initial skepticism was replaced by a spirit of collaboration – and, in many instances, genuine enthusiasm.
Looking toward the future, there’s reason to be optimistic about the potential for greater innovation in pharma, especially around the consumer experience. As recently as half a decade ago, conversations surveying the need for institutionalized innovation and the most effective ways to drive it were muted, if they took place at all.
Now there’s a more tacit acceptance that a distinct innovation function, led by an individual or team backed by C-suite mandate, is a must-have, rather than a nice-to-have. It’s no longer a bolt-on; it’s increasingly ingrained across commercial teams and functions. And rather than waiting until innovation is needed to jump-start a stagnating brand, it is happening much earlier. It has become part of the launch-excellence roadmap, often initiated well before commercialization so that ample time and effort can be allocated to ensure an optimal product launch.
None of that is to say that pharma has solved its innovation dilemma. But many of the industry’s most forward-minded organizations have the will and the patience necessary to internally align around an innovation agenda. The best is soon to come.
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