Main Subject - Business

In my organisational career, I had budgets from the age of 22 to 47. I lived and breathed them and many times, budgets, the gospel that they were, caused havoc, albeit within the corporate retailer framework that I worked.

According to USFDA, a combination product is one composed of any combination of a drug and device; biological product and device; drug and biological product

r>Here are two examples of the damage caused.

Example One

Typically budgets were initially discussed in January, just after the Christmas rush. They were always dependent on year-on-year sales growth and

; or drug, device, and biological product and fixed dose combination would include two or more combinations of drug.

Examples of combination products may in

at the time in question, individual businesses were not expected to deliver 'profits', as the way the business was structured was not capable of sustaining that level of information.

So the budget got signed off about

lude drug-coated devices, drugs packaged with delivery devices in medical kits, and drugs and devices packaged separately but intended to be used together.

May (for the fiscal year staring the April a month before!). Monthly sales budgets were built, usually to a corporate model, as were cost budgets, the biggest of all being salary costs. Half year budgets had to be met and so by

here is enormous increase in the number of combination products entering the market in the recent years. Combination products have proven advantages but fixe

the time September's costs were in, you were well into planning your Christmas.

One year, after a review of performance of the organisation as a whole at the half year, a decision was made to radically trim salary budget

d dose combinations are still in the process of convincing regulatory authority on their advantages over the single ingredient formulations.

Combination pro

for the rest of the year. Out of 20 businesses in my geographical region, 8 were told to cut costs dramatically from November onwards. Because of the way that employment legislation works in the UK, you can't just lay people o

ucts have become life saving products for the pharmaceutical companies who doesn’t have many innovative molecules in their product pipeline and have been inc

ff. So we had to find a better way to cut costs, just before Christmas (and at that time, the only two months the organisation made any profits to speak of were in November and December!)

It was decided to reduce the

easingly used in the product life cycle management. Even the companies having product patents are trying to extend their product life cycle through the combi

ours of every member of my staff (some 125 people) by 9.9% (apart, much to my personal disagreement, from the management team, who would be under 'much greater pressure', so would maintain their hours (and salary)). Al

nation products and maximize the revenues. But the companies involved in this practice are overlooking that they are burdening the patients both economically

though I say it myself, I had a great relationship with my team, and everyone made matters much easier by complying with the 'request' within days (instead of the statutory notice-period, which for some could have been up to 12

and physically. They need to rightly judge the benefits of the combination products and they have to even look at the risks involved when combining the produ

eeks). My people were rock solid in how they put themselves forward and I was humbled.

But my Christmas business was badly damaged. The most profitable time of the year was damaged, badly and when the sums were

ts. Some of the combination products were well accepted by physicians while others suffered. Companies involved in development of combination products are fi

dded up, we lost 'profit', as far as I could calculate. The organisation's reputation was in tatters - and for what. Driving to achieve the budget, and more importantly keeping a lid on costs!

Example Two

ding difficulty in defining their combination products and facing various challenges from selecting a combination to marketing it.

Following aspects would a

My second example is the same organisation, bang up-to-date. Like right now, December 2004.

A manager is promoted in July 2004, to a very difficult store to manage - rather beyond his capability really. He inherits a b

dd to the challenges in developing combination products:

Which markets to tap where the combination products can do fairly well?
Which combination prod

dget cost overspend and is told to recover it by the end of the fiscal year (March 2005). He decides to cut back drastically on anything he can cut his staff costs on. So he 'cancels' Christmas recruitment and plans no ext

cts are meaningful and rational?
Which therapeutic categories to select?
Which Combinations can address unmet needs of the patients?
Do combin

ras for the busiest period of the year. Admitted, not the only period they now make a profit on, but still very, very important to their profitability, for the year.

Things go badly wrong:-

Systems fall apart.

tions increase the patient compliance?
What would be the developing cost?
How to tackle the risks encountered during combination product developmen

br>

Preparation of merchandise for Christmas is too late.

Staff morale plummets.

People leave.

Absense levels rise.

He becomes depressed.

He makes some serious lapses of judgement

t?

As combination products don't fit into the traditional categories of drugs, medical devices, or biological products, the USFDA is in the process of devel

because of the pressure.

He is disciplined and demoted.

Another manager (the fourth in five years) is brought in.

There is a severe underperformance in sales (est. ?50-100,000 for the period)

ping new procedures for reviewing their safety, efficacy and quality.

Professional from academic institutions, pharmaceutical industries, health care indust

The manager's confidence is ruined, forever.

All to meet the budget...

He's not a bad guy, in fact he has worked his socks off. With support and guidance he could have made this work and then progress his career. He

y and representatives from various regulatory agencies are working out to design the regulatory requirements for manufacture and sale of combination products

as given none of these, except told that he had to make the budget. The article goes on to say that rather than performing to a pre-written script, managers are far better when they work towards forecasting more and more a

.

As there is an increasing trend of the combination products companies manufacturing such products should be able to tackle the problems involved in the de

ccurately on a rolling (and, over time, learning) basis. Performance and results become a lot more honest, realistic and outwardly (i.e. customer) focused, rather than inwardly (i.e. how to avoid or 'cheat' the budg

elopment. They need to be wiser in analyzing the market trends and the regulatory requirements.

Companies that provide selfless information through particip

ting system).

Perfect solution?

Maybe. It's just the nagging fear I have that the organisation anonymously mentioned in the article, with the solution above, might be the one I've been talking about in my examples..

tion in industry events and feedback to regulatory authorities would be able to face the challenges and will be successful in developing combination products

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