Strategy Insights

Why is strategy so difficult to explain? Ask 10 people this question, and you’ll likely get 10 different answers. Understanding what strategy is and how to build one becomes mission-critical when navigating drug development. So let’s talk about it. What is strategy?

At its core, this strategy is about making explicit choices about what you will and will not do to achieve a goal. In early drug development (Discovery → Phase I), these choices compound quickly. Every dollar and decision shapes your future clinical, regulatory, and commercial path.

Examples of these choices are:

• Which disease or disorder will your drug target?
• Which patient population(s)will you prioritize, and who will you exclude?
• Which targets will you develop and which will you deprioritize?
• Which preclinical experiments will you perform, which are nice-to-haves, but unnecessary now?

Bring clarity to these choices by starting with the end of the mind. Imagine your drug has already been approved. Picture the drug product, the patients, how the drug being given to patients, and its impact on the disease or disorder.

Discuss within your team:

• What condition does the drug treat?
• Who benefits from the drug?
• What is the drug’s mechanism of action?
• How is it administered?

Begin writing these thoughts down so you can continue to build on these ideas. The clearer your vision, the easier it becomes to define your drug concept to make smarter choices along the development journey.

Strategy forces you to choose what is important and what is not. Choose wisely.

Many innovators become trapped in “red oceans,” where biotechs fiercely compete for the same patients, price points, and treatment standards. Blue Ocean Strategy identifies and creates “blue oceans,” untapped market spaces where the industry rules are still undefined, making competition irrelevant.

Value Innovation is the foundation of Blue Ocean thinking. Applied to drug development, it is the simultaneous pursuit of higher patient value and lower development costs. Instead of choosing between value and affordability, value innovation integrates both, breaking the traditional value-cost trade-off.

Value innovation should not be confused with technological innovation. Utility, cost position, pricing and innovation are given equal weight to pursue value creation. Every dollar and decision shapes your future clinical and commercial path. To begin applying value innovation principles to your drug development programs, ask yourself the following questions:

What activities could you ELIMINATE that increase R&D costs but do not enhance patient value?

What inefficiencies or bottlenecks could you REDUCE to accelerate progress to the clinic?

What unmet patient needs and clinical priorities can you address that RAISE the appeal of your drug candidate(s)?

How can we CREATE pathways to address additional patient populations or enter new market spaces where your drug can command value?

This structured, strategic process helps decrease development costs while also revealing opportunities to enter uncontested market spaces with clinical and commercial impact. Value innovation can translate promising science into market leadership. Explore how value innovation can reshape your drug development journey. A big blue ocean of opportunity awaits those who look beyond the status quo.

Drugs that deliver exceptional patient value at a sustainable cost can attract investor confidence, secure funding, and withstand shifting market dynamics.

Nope, not at all. Numerous companies spend millions of dollars each year developing drugs with vague aspirations and unclear product characteristics, burning time, money and resources along the way. I have seen it time and time again. Strategies mistaken for goals, plans, mission and vision statements. Vague statements of generalization that can be applied to any new drug in its competitive arena.

But when you come across a robust drug development strategy, you feel it. The approach is clear. The choices are explicit. Every element connects back to a well-defined goal.

All robust drug development strategies I have come across share some common characteristics:

• Unmet Medical Need with a strong market potential. Your drug must solve a real problem for patients in a space where current options fall short.
• Divergence away from the status quo of your competitive drug arena. If your strategy looks like everyone else's, it is not a strategy. It’s imitation. Don’t confuse the two.
• Focus reflected in clear choices: indication, patient population, modality, route of administration. What you choose not to do matters just as much as what you choose to do.
• A Compelling Tag Line that inspires the stakeholders who influence the approval and adoption of your drug. If you cannot clearly communicate your drug’s value proposition, you have not hit the clarity mark.
• Credibility marked by a team that possesses the expertise and translational mindset to guide development. The science alone is simply not enough. The people behind the science must know how to move it forward.

Your approach should be dynamic, decisive and iterative. Like the dendrites of a neuron, your strategy may branch out and extend into new areas of focus over time. That is the nature of drug development. The landscape shifts, the data stream provides new insights, and your strategy must evolve with them.

Embrace the iterative process required to mature your strategy. Your choices must neatly click together like pieces of a puzzle.

New drug market spaces can be created in fiercely competitive therapeutic areas. Biopharma offers many examples of Blue Ocean’s value innovation (the pursuit of value and affordability) in action. IL-23 biologics are the current market leaders for moderate-to-severe plaque (M2S) psoriasis due to their efficacy (PASI90/100), speed to clearance, and therapeutic durability. Currently, all biologics (TNFα, IL-12, IL-17, and IL-23) for M2S psoriasis are administered IV or SC.

Oral drug offerings are expanding access for injection-averse patients. TYK2 (Sotyktu) and PDE-4 (Otezla) small molecule inhibitors have unlocked a new market space for injection-averse patients by successfully:

• ELIMINATING the need for injection training, sharps disposal, and doctor visits for IV infusions.
• REDUCING regimen drop-off due to injection fatigue.
• RAISING patient utility by ease of use. Taking a pill fits nicely into the daily routine.
• CREATING drug options with lower costs and med-to high efficacy (PASI75/90), appealing to injection-averse patients.

The numbers speak for themselves: Bristol Myers Squibb’s Sotyktu and Amgen’s Otezla each brought in $291 Million and $2.6 Billion in FY2025 revenue, respectively (1-2; citations in chat below).

Reconstruct the value proposition within your chosen competitive arena to carve out new market spaces. ELMINATE, REDUCE, RAISE and CREATE!

What unique value does your drug provide that separates you from your competitors? Can you state this clearly?

High efficacy, safety, and tolerability are must-haves to bring a competitive drug to market, but this is often not enough to unlock new market spaces. To do this, you need to reconstruct the value elements that matter most to investors, collaborators, regulators, prescribers, and patients in your competitive arena. Blue Ocean Strategy’s Four Actions Framework offers four guiding questions that help drug innovators redefine their value proposition in early development. Applied to early drug development, consider the following questions:

What activities could we ELIMINATE that increase R&D costs, but do not deliver additional value to our buyer groups?

What inefficiencies or bottlenecks in R&D could be REDUCED?

How can we CREATE pathways to include new patient populations or enter new market spaces?

What unmet patient needs and clinical priorities can we address to RAISE our drug’s appeal?

These four questions force you to rethink what the competition offers and how they compete. They empower you to break the value-cost trade-off (the idea that higher value requires higher cost) by:

• Eliminating and reducing costs where competitors over-invest or overshoot on what your buyer group values.
• Raising and creating value by increasing patient utility or reducing friction points for your buyer group.

Focusing only on “Raise” and “Create” risks developing an expensive, over-engineered drug product that brings little additional value. If you only “Eliminate” and “Reduce,” you risk stripping value away from your development that could jeopardize efficacy, safety and tolerability. The power of the framework lies in its ability to answer all four questions.

Use the Four Actions Framework to diverge away from competitors and unlock a blue ocean of opportunity where competition is irrelevant.