In the pharmaceutical industry, the stakes for a new product launch could not be higher. Years of research, hundreds of millions in investment, and the hopes of both patients and shareholders ride on a successful entry into the market. Yet the statistics are sobering: industry studies show that 56% of drug launches fail to meet their pre-launch expectations.
In competitive therapeutic spaces, where multiple comparable treatments are available, the failure rate is even higher, climbing to 60%. For companies navigating an already complex regulatory and commercial environment, these numbers highlight a simple truth: clinical success does not guarantee commercial success.
This article explores the most common reasons pharmaceutical launches underperform, and the practical steps that companies can take to improve their odds, based on Sedulo Group’s experience supporting launches across diverse therapeutic areas.
Why Drug Launches Fail
Poor Product Differentiation
Even with positive clinical data, a product can fail to stand out if its differentiation is unclear or insignificant in the eyes of healthcare providers (HCPs), payers, or patients. When efficacy and safety profiles are comparable to competitors, the choice often defaults to the product with established relationships, proven access, or stronger brand recognition.
Example: Two therapies with similar clinical outcomes may see vastly different adoption curves if one is easier to administer, has better patient support programs, or requires fewer prior authorizations.
Incomplete Market Understanding
Market research that is too narrow, or too late, can lead to misalignment between the product’s value proposition and the needs of key stakeholders. This includes missing insights into treatment algorithms, reimbursement barriers, patient journey complexities, and evolving competitive strategies.
A common pitfall is designing Phase 3 trials without fully understanding what endpoints or patient populations matter most to decision-makers. This can limit label potential and reduce the product’s competitive appeal.
Market Access Challenges
Market access hurdles are a major reason launches stumble. Even if payers grant formulary placement, the quality of coverage, such as restrictions, step edits, or high patient co-pays, can significantly impact adoption.
Payers are increasingly using exclusion criteria and rebate negotiations to control costs. Without proactive payer engagement well before launch, companies may be caught off guard by these dynamics.
Reactive Rather than Proactive Competitive Intelligence
Some organizations monitor competitors but fail to integrate these insights into strategic decision-making. The result is a reactive approach, responding to competitor actions after they happen rather than anticipating them.
Proactive competitive intelligence (CI) means mapping likely competitor strategies, testing ‘if this, then that’ scenarios, and developing counter-messaging before a rival makes their move.
How to Beat the Odds
Beating the 56% failure rate is not about finding one magic tactic. It’s about building a launch plan that integrates competitive intelligence, market insights, and cross-functional collaboration from early development onward.
Begin CI and MI Early
By Phase 2, companies should already have a competitive monitoring plan in place, not just to track clinical trial progress, but to inform trial design, target product profile (TPP) refinement, and evidence generation strategies.
Best practices:
- Monitor competitor endpoints and patient diversity in trials.
- Assess competitor manufacturing capabilities and commercial readiness.
- Map evolving treatment algorithms to identify potential positioning opportunities.
Scenario Plan for Competitor Actions
Scenario planning is a critical safeguard against surprises. Ask:
- How will competitors respond if our Phase 3 data is strong?
- What counter-messaging might they use to blunt our value proposition?
- What tactics will they deploy if they launch before us?
Workshops that stress-test your strategy against these possibilities help ensure you have counter-moves ready — reducing the lag time between competitor action and your response.
Anchor Your Strategy to Stakeholder Needs
The most successful launches align their product story with the practical and emotional drivers of HCPs, payers, and patients. That requires direct engagement, not assumptions.
Stakeholder-specific considerations:
- HCPs: Will your data change their prescribing habits? How quickly?
- Payers: What economic or clinical evidence do they need to justify coverage?
- Patients: Does the treatment reduce barriers like cost, complexity, or side effects?
Integrate Insights Across Functions
Insights lose value when siloed. Commercial, medical affairs, clinical development, and market access teams must operate from a shared understanding of the competitive and market landscape. Regular cross-functional reviews ensure that everyone is working toward the same differentiated position.
The Sedulo Perspective
At Sedulo Group, we’ve seen that overcoming launch risk requires more than executing a checklist. It’s about maintaining strategic agility, anticipating the moves of a dynamic competitive environment while staying grounded in market realities.
Companies that consistently outperform in launch:
- Start market and competitor monitoring as early as possible.
- Use analog uptake curves for realistic forecasting.
- Maintain disciplined scenario planning throughout development.
Ready to move beyond the 56% failure rate? Download Sedulo Group’s Insights-Driven Launch Planning white paper for a stage-by-stage framework to strengthen product differentiation, secure market access, and position your product for launch success.