Pharmaceutical market dynamics and strategic planning: a system dynamics perspective

Competitive pressures are forcing pharmaceutical companies to develop even more effective product-based strategic plans, which have traditionally been derived from unarticulated mental models about the individual diseases and the role of various decision-makers within them. The industry is blessed with a wealth of patient- and physician-level data, but often this information is not leveraged to its full extent. System dynamics provides an operational framework for understanding and analyzing how the interaction of patient flow dynamics, physician prescribing/product adoption behavior, and the evaluation of therapy options drive marketplace behavior. By evaluating the response of such an integrated model to possible marketing initiatives, pharmaceutical firms can develop and ultimately execute more cost-effective strategic plans for their products.