Now that sales are flagging, analysts of all stripes are writing that they long ago knew this was going to happen. This Monday-morning quarterbacking is known in behavioral circles as hindsight bias, or, as I like to call it, bullshit. What nearly every stock analyst and pundit wrote while Exubera was in Phase 3 testing was that Exubera was going to be a big success. Nearly every clinical opinion leader I heard from (there were many) said the same thing.
What happened once Exubera was launched, its lackluster sales, isn’t nearly as interesting as how Pfizer and industry observers reacted to what was happening in the two years prior to launch. Within industry, there are lessons here for market research, scientific communications, investor relations and executive management of all functions.
Chief among these lessons is this: If you care about predicting customer responses to new products, and I’m sure you do, you cannot rely on inferences drawn from surveys, interviews, direct observations, product analogs, etc from a single point in time. You must follow trends in attitudes and actions as information becomes available, and you must do so continuously during development and after launch. A corollary is that you must carefully plan how you seek and disclose attitude-influencing information.
Which leads me to my second lesson: Keeping emerging product information secretive can be important for competitive reasons, but secrets are antithetical to the tasks of predicting market responses to products and to setting financial market expectations; a balance is therefore required. With a product like Exubera, there were opportunities for disclosing to interested parties, namely key opinion leaders, selected patients, and investors, certain competitive information earlier and more fully than was done.
Here, I’m thinking specifically about the emerging product profile (i.e. safety, tolerability, efficacy, convenience, and usage) and Pfizer's data and arguments supporting the cost-effectiveness of the product, which I’ve reviewed here previously. If you’re a Pfizer employee, it’s now time to review whether your internal and external information disclosures were sufficient and timely to meet your market research, commercialization preparation, and financial market goals. Be brutally honest with yourselves and take corrective policy action if deficiencies are found. You may need different policies for different classes of products (e.g. a pioneering product vs. a fast follower).
For observers, and investors particularly, my suggested take away is this: Recognize in yourself your reluctance to change your opinion as evidence mounts to the contrary; the strength of your unwillingness to change your mind is proportional to the strength of your held opinion. This is hardly a novel insight, as published evidence supporting it dates to at least the 1950’s. In behavioral circles, it’s known as attitude strength, or as I like to call it, stubborness. You might not be able to overcome your stubborness, but you might be more willing to hedge your bets if you can admit to it.
PFE 1-yr. chart: