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Forecasting and its Impact on Clinical
Supply Chain Efficiency
Greg Hottell Director, Supply Chain Group Lead
GSK - Pharma R&D
Session Abstract:
● Looking at the impact forecasting has on
managing your clinical supplies to ensure you
save costs and avoid delays
● Utilizing approaches towards forecasting to
respond to changes to demand and lead times
● Analyzing methods to reduce product wastage
and help save cost
● Looking ahead - How can innovation in
technology disrupt and improve forecasting
This presentation was prepared by Greg Hottell in his personal capacity. The opinions expressed herein are the author’s own and
do not necessarily reflect the views of GSK.
Session Agenda
• Introduction and Session Set-Up
• Part One: Overview of Forecasting in Clinical Supplies
• Part Two: Greg’s Five Forecasting Principles
• Part Three: Looking Ahead
• Session Conclusion + Q&A
Greg Hottell May 2017
Part One:
Greg Hottell May 2017
What is Forecasting?
“Forecasting is the process of making predictions of the future based on
past and present data and most commonly by analysis of trends.” 1
Why do we Forecast?
1. Align on likely future events = addressing the uncertainty
2. Support current efforts at decision making
3. Allocate limited resources in an optimal manner
Greg Hottell May 2017
1 = https://en.wikipedia.org/wiki/Forecasting
What are we trying to Forecast?
Greg Hottell May 2017
It all depends on what you are trying to plan for…
The key is to get everyone on the same page!
• Strategic planning • Link to commercial • Tends to support finance • Focus on critical
resource(s)
• Strategic planning • Roll-up of multiple trials • Supports manufacturing
activities (long lead time)
• Tactical planning • Specific to a clinical trial • Supports packaging and
labeling plans (short lead time)
• Operational planning • Focus on events that are
material to the plan (e.g. enrollment rates, milestones, drop-outs, etc.)
“How much will it cost to fund my R&D unit?”
“Which molecules should I bring forward?”
“How much will it cost to develop this molecule?”
“Can we support all of the potential indications?”
“What is my plan for this clinical trial?”
“When will the significant spend events occur?”
“What do I expect to happen during this trial?”
“What events or activities will impact my plan?”
Forecasting Basics
• Forecasts are a ‘best guess’ of future events
• Forecasting only applies to Independent factors (vs dependent)
• Mind your units of measure ($$$ vs. drug vs. patients, etc.)
• Work to eliminate bias; be mindful of random chance
• Fundamental input to the ‘Clinical Supply Tradeoff’ Greg Hottell
May 2017
The Fundamental Tradeoff in Clinical Supplies In the Clinical Supply Chain, the pressure to achieve results at low cost is very real...
Greg Hottell May 2017
SUPPLY DEMAND
TOO MUCH!
Waste
• Cost of drug
• Cost of forward processing
• Cost of shipping
• Cost of storage
• Cost of reconciliation
• Cost of destruction
NOT ENOUGH!
Lost Patients / Delays
• Delay to recruitment
• Each day of delay for a future blockbuster costs a Pharma company up to $8MM to $15MM in lost revenue 1 & 2
• Possible serious breach if patient treatment is disrupted
1 = Source: http://www.prnewswire.com/news-releases/clinical-trial-delays-cost-pharmaceutical-companies-55044607.html 2 = Source: http://www.pharmexec.com/no-time-delay
Which isn’t too challenging, if patient enrollment forecasts are reasonably accurate...
A Deeper Look at Patient Enrollment Forecasts...
Patient Enrollment is a key challenge for the clinical trial supply chain:
● Only 39% of sites in a given trial meet their enrollment targets 1
● 50% of trial sites enroll zero or only one patient 2
● Up to 45% of studies are delayed due to enrollment difficulties 3
Up to 30% of clinical development lifecycle rests on patient recruitment 4
Sources:
1. http://csdd.tufts.edu/news/complete_story/pr_ir_jan-feb_2013
2. Pierre, C. Recruitment and retention in clinical trials: What works, what doesn’t and why. Presented at 2006 DIA Annual Summit; June 2006; Philadelphia, PA.
3. D.L. Anderson, A Guide To Patient Recruitment and Retention (CenterWatch, Boston, MA, 2001)
4. Hess, Jon. Web-based Patient Recruitment. Cutting Edge Information. 2005 Greg Hottell May 2017
Forecasting is a Real Challenge for Clinical Supplies...
Steve Davidson
Greg Hottell May 2017
…now let’s explore some fundamentals to support you in your approach to forecasting.
Part Two:
Greg Hottell May 2017
Greg’s Forecasting Principle #1:
There is one thing all forecasts
have in common...
...they are wrong!
Greg Hottell May 2017
Forecasts are a best guess of how future events may unfold.
Greg’s Forecasting Principle #2:
If the forecast is predictably bad...
...plan around the error!
Greg Hottell May 2017
Every forecast should include an estimate of error to help the team plan for the likely level of uncertainty.
Build supply strategies that support the likely error.
Greg’s Forecasting Principle #3:
If a significant part of the forecast
changes routinely...
...you don’t have a forecast!
While forecasts may always be wrong, that does NOT absolve the forecaster from being accountable for their projections
Greg Hottell May 2017
Greg’s Forecasting Principle #4:
None of your colleagues have a
working crystal ball...
...if they did, they would
be in Vegas!
Greg Hottell May 2017
Guesses can only take you so far – try a different approach...
Greg’s Forecasting Principle #5:
If you wouldn’t behave that way at
home...
...don’t bring your bad
behaviors Into work!
Greg Hottell May 2017
Whose money it is should NOT affect your behaviors.
Part Three:
Greg Hottell May 2017
Looking Ahead #1: Computer Simulation Tools
“A computer model is the algorithms and equations used to capture the
behavior of the system being modeled. By contrast, computer simulation is the
actual running of the program that contains these equations or algorithms.” 1
The Opportunity: Tools to help companies optimize their clinical supply plans
• Seeks to simulate random events
• Helps to validate demand assumptions
• Tests the robustness of supply plans
• Only as good as the input data and the computer model
Greg Hottell May 2017 1 = Source: https://en.wikipedia.org/wiki/Computer_simulation
Looking Ahead #2: Data Analytics
“Data analytics (DA) is the process of examining data sets in order to draw
conclusions about the information they contain, increasingly with the aid of
specialized systems and software.” 1
The Opportunity: leveraging available data to identify and understand
meaningful cause-and-effect, trends, and other relationships
• All about asking clever questions of the data and mining for meaning
• Can be limited by access to quality data sources
• This capability can take computer simulation to the next level
Greg Hottell May 2017 1 = Source: http://searchdatamanagement.techtarget.com/definition/data-analytics
Looking Ahead #3: Virtual Clinical Trials
“Virtual clinical trials are a relatively new method of collecting safety and efficacy data
from human trial participants. These trials take full advantage of the omnipresent
technology and online social engagement that are a part of its participants’ lives, by using
electronic versions of all trial processes including recruitment, informed consent, patient
counselling, and data collection.” 1
The Opportunity: By engaging patients earlier in their decision process, we can better
understand – and hopefully predict – their actions.
• Better access to patient demographics and interests
• Opportunity for concierge-style reservations
• Further opportunities exist when combined with Direct to Patient (DTP) supply paradigms
Greg Hottell
May 2017 1 = Source: http://xtalks.com/Virtual-Clinical-Trials-1.ashx
Bringing it All Together... Forecasting and its Impact on Clinical Supply Chain Efficiency...
Your colleagues don’t have a crystal ball
Behave as if it is YOUR money
If the plan changes daily, it isn’t a plan
Plan around predictably bad forecasts
All forecasts are wrong
Greg Hottell May 2017
● Forecasting is necessary to support decision making and resource allocation
● Too Much = Waste Too Little = Delays
● Be mindful of what is being forecasted ($$$ vs units)
The Basics The Principles The Future
Thank You!
Greg Hottell Director, Supply Chain Group Lead
GSK - Pharma R&D
About the Presenter: Greg Hottell is a Director in the Clinical Interface team at GSK, where he is responsible for the cost-effective, patient-focused supply of investigational product for GSK’s pharmaceutical development portfolio. Since joining GSK in 2011, Greg implemented an end-to-
end planning platform for clinical supplies, helped redesign GSK’s approach to clinical supply blinding and unblinding risk management, was a core team member for the Investigational Material Supply strategic planning initiative, all while consistently delivering top-tier performance with on-time supply of investigational product to patients. Greg has been a Supply Chain professional since 1999, most recently holding positions of increasing responsibility at Eli Lilly & Company and Fisher Clinical Services prior to joining GSK. Greg has a diverse background in the Pharmaceutical Industry spanning roles that include clinical trial materials management, demand planning, site inventory management, IRT utilization, drug product supply planning, temperature excursion management, study drug expiry dating extensions, customer service, operations planning & scheduling, and procurement. Greg holds a bachelor’s degree in Operations Management, an MBA, and is a Certified Fellow in Production and Inventory Management (CFPIM) through APICS.
