Forecasting an On-Market Product: Higher Accuracy, Greater Versatility
Situation
CLIENT
Large pharma/biotech company
PRODUCT
On-market, non-retail drug distributed through limited network of specialty pharmacies and distributors, in an active competitive environment
ASK
Design and build a custom forecast model that integrates seamlessly with the existing Latest Estimate (LE) process, and is versatile enough to support multiple stakeholders and the long-term brand planning process
Challenges
DATA COMPLEXITY
Product and distribution model involving multiple and disparate data sources
- IntegriChain (unit demand, inventory)
- Patient data (enrollments, restarts)
- Internal (finance, ex-factory)
MARKET EVENT MODELING IN ABSENCE OF COMPETITOR DATA
Specialty (non-retail) distribution model across all competitors hindered the availability of market data – however – complex market events were impacting product performance which increased the complexity of modeling
CROSS-FUNCTIONAL STAKEHOLDER NEEDS
Sales, marketing and finance each had distinct objectives for the model, including harmonization of the unit-demand forecast with patient enrollments
Approach
IMPROVED USER EXPERIENCE
Built an organic model with a streamlined flow, incorporating VBA–driven automation, with complete transparency and user-friendly design
MAPPED CROSS-FUNCTIONAL STAKEHOLDER NEEDS
Identified discrete needs across sales, marketing and finance stakeholders and created customized outputs to meet them
MODELED COMPLEX MARKET EVENTS
Assimilated market research (ATUs) to understand and model for multiple market events using diffusion curves
DESIGNED MULTIPLE FORECASTING PATHWAYS
Created capabilities for the user to choose from multiple forecasting pathways (unit demand vs. patient enrollments) that were harmonized across the platform
EMBEDDED IN-HOUSE FORECASTING PALETTE
Integrated a robust but transparent statistical palette (Exponential Smoothing, Holt-Winters, Box-Jenkins etc.), resulting in improved forecast accuracy and model flexibility
DEVELOPED VISCADIA ACE® FORECAST PLATFORM
Customized platform for the product that allowed for dynamic, comprehensive evaluation of key performance drivers, and served cross-functional stakeholder objectives
Outcomes
END DELIVERABLE
- Viscadia ACE® forecast platform with a comprehensive set of output views and summaries addressing cross-functional stakeholders
- User manual providing extensive documentation of model design and operation, to facilitate easy knowledge transfer
- Executive slides to facilitate quarterly LE discussions, generated by an automated module within the model
KEY HIGHLIGHTS
- Reduced the MAPE (mean absolute percentage error) by nearly 50% in actual vs. forecast for the new model compared to the existing model
- Dynamically modeled for five major market events occurring at different times in the forecast horizon
- Successfully enabled the forecast team to tie the revenue forecast to weekly patient enrollment targets for the sales team
IMPACT
- Reduced workflow for quarterly LE from ~40 hours to ~8 hours
- New model served as the base platform for future Life Cycle Management (LCM) strategy scenario-planning exercises
- Client asked Viscadia to design and build a new model for another product within the same franchise
