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How to Use Regulatory Operations as a Competitive Advantage in Emerging Markets


Posted in Regulatory and Compliance by MDDI Staff on May 7, 2014

Efficient regulatory execution is the key to a successful growth strategy in hard-to-navigate emerging markets.


By Amy Flynn and Vicki LaRosa, TayganPoint Consulting Group

The regulatory team has always been considered a strategic business partner within medical device companies, due to its responsibility for building and maintaining strong working relationships with regulators. Working with regulators early in the process helps companies realize their favored outcomes more often. Equally important and appreciated is an organization’s commitment to developing a detailed regulatory strategy—from ensuring a device’s classification is appropriate to managing premarket submissions to maintaining product clearance.

Learn more ways to use regulatory prowess to your advantage at MD&M East, June 9–12, 2014, in New York City.

What organizations have historically underestimated is the value of an efficient regulatory execution group. Failure to see the potential of a highly functioning regulatory operation as a competitive advantage could detract from business growth.

While major industry trends such as interoperability; big data; multifunctionality; and mergers, acquisitions, and partnerships are creating an unclear regulatory environment in the most developed nations, the landscape is even more complicated in emerging markets, where companies are competing for growth. In addition to increasing sales, companies are looking to build capabilities such as manufacturing, marketing, and clinical operations in many emerging market countries. Companies are competing for partners or acquisition targets to enable access, grow market share, and expand the development pipeline. Capturing the value of these growth strategies relies heavily on efficient, effective regulatory execution, often in markets that are especially difficult to navigate.

Many emerging market countries have newly established medical regulatory agencies and new legislation around medical devices. While the aim of these new agencies may be a transparent review and approval process, even in developed nations with longstanding regulatory agencies, guidelines can be ambiguous. Regulations in the countries where companies are competing for growth are often unclear or changing. Viewing regulatory execution as a strategic partner in business growth and recognizing an effective regulatory operations organization as a competitive advantage will lead to new investments in process, technology, and people with increased return in throughput, quality, and predictability. Effective regulatory execution functions will enable companies to identify regulatory risk early, make informed business decisions, build sound mitigation plans, and flex with the varying interpretations to drive regulatory projects to closure.

The regulatory essentials that translate into competitive advantages and enable a company to be first to market or lead the pack in partnership desirability include the following:

  • Thorough local regulatory knowledge.
  • Robust regulatory processes for prioritizing, planning, and managing regulatory work.
  • Seamless work flow between central or headquarters functions and the local filings.

In many developing countries, the regulatory authorities are relatively new. In others, the regulatory rules change with the changes in government leadership. Many countries use regulations to drive economic growth or accomplish other political goals. Sometimes, countries use regulations to counter past injustices regarding the perceived quality of products brought into their countries. Accurate, timely, local regulatory knowledge is an essential first step. Awareness of these regulations, as well as the underlying beliefs or fears that drive some of them, the levers that are pushed or pulled that lead to changes, and the economic and political environment in the region is critical. This knowledge should inform business decisions and partnership selection by helping business development teams understand the true gaps to access in a given market. Countries that demand local manufacturing will drive different business partnership needs than countries that are looking to ensure product quality and clinical studies in local populations. Knowing these drivers will help businesses identify the important alliances to build and select the best partners.

The work of regulatory teams itself must be thorough, consistent and, most of all, compliant. But that same rigidity should not be applied specifically to the processes for prioritizing, planning, and managing the regulatory work. These processes need to be robust, with the flexibility to accommodate new market opportunities that were not part of an initial plan and the ability to shift with varying regulatory requirements across emerging markets or the changing demands of a newly formed regulatory authority.

Companies need to prioritize their efforts across all markets, and the model for prioritization must allow for shifts to the priorities due to market-to-market dynamics. Milestone tracking is not enough. Projects must be actively planned and managed. Risk and issue management must anticipate competitive advances and the impact of changing regulations or guideline interpretations. Management of regulatory projects must drive decisions to accelerate or decelerate timelines to counter environmental influences and maintain a balanced workload across the regulatory execution value chain.

Partnerships, alliances, mergers, and acquisitions are important parts of business strategy in emerging markets, and each of these drives regulatory projects to run clinical studies, transfer marketing authorization, or codevelop new products. As such, there is a need to plan projects in a coordinated way to ensure that consolidation of manufacturing operations in one country does not limit the registration sample or launch supply in another country. Active and robust processes for prioritization and project management ensure that these plans are connected and that the hierarchy for execution is in line with the strategic decisions. All of this leads to more balanced, thoughtful timelines that account for risks and issues and can be delivered predictably.

In larger organizations, the regulatory function is often delineated between central and local operations. Given the need for solid local knowledge to drive regulatory planning and the need for informed project management to balance workload and manage timelines to meet the local environment, communication between the two is essential for effective execution. Centrally organized teams should include local representatives despite the difficulty of doing so because of language barriers and time zone differences. More importantly, the value of a direct conversation about local requirements must be appreciated. Maintaining databases of local regulatory information is the goal of many organizations, but the reality of changing requirements and interpretations of those requirements makes the upkeep of that data unsustainable, and reliance on a database is not enough. Specific, direct communication between those with firsthand local knowledge and those regulatory specialists who are removed from the local situation but responsible for preparation of dossiers is critical.

These regulatory essentials impact a company’s ability to be first to market, capture merger value, or be the most desirable partner. By enabling better upfront decisions informed by the combination of local and global knowledge as well as allowing for coordinated plans across different initiatives, these regulatory essentials produce more appropriate timelines and predictability for delivering regulatory outcomes.

It is one thing to develop a strong regulatory execution arm and deliver consistently. It is another to communicate both within the organization and to potential partners the competitive advantage achieved through superior regulatory execution. The ability to devise a strategy informed by local regulatory knowledge and deliver consistently will over time speak for itself in terms of the number of regulatory authority approvals, decreased throughput time to approval, and fewer issues because they were mitigated as early identified risks. It is important to maintain these metrics as evidence. In the near term, it is important to provide visibility to the processes that drive prioritization and planning, and it is critical to transform regulatory data into knowledge and intelligence that serve as the primary resource for evaluating how regulations, standards, criteria, and policies will affect the organization in the future.

Regulatory execution is not a Rube Goldberg machine that spits out new medical device submission dossiers. It is the connection that links the product to regulatory strategies and to the filings themselves. It is the engine that drives the work to produce those filings. Solid execution relies on sound regulatory operations, local regulatory personnel for submitting filings, and process and communications to connect the two. Changing business partners’ perception of the value of solid regulatory execution requires internal clarity on processes and roles, consistent delivery, early engagement of those partners, and the transformation of individual pieces of data into valuable information that enhances the organizational ability to make game-changing business decisions.

Learn more ways to use regulatory prowess to your advantage at MD&M East, June 9–12, 2014, in New York City.

Amy Flynn and Vicki LaRosa are consultants at TayganPoint Consulting Group. TayganPoint Consulting Group, an Inc. 5000 company, is a strategic management consulting firm that implements strategy and organizational change in life sciences, health care, financial services, and energy organizations to improve their efficiency and overall business performance. Contact the authors at 609-460-4211.

[image courtesy of Boians Cho Joo Young/FREEDIGITALPHOTOS.NET] 


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