While prominent physicians can provide companies with valuable guidance during development, their perspective is limited when it comes to projecting how well or how readily a new product will be adopted. Here’s how to perform rigorous commercial diligence.
In pharmaceutical development, few relationships are more eagerly cultivated—or more systematically misunderstood—than those with key opinion leaders. Companies spend enormous resources identifying, engaging with and listening to these KOLs for ad boards, clinical trial support and speaking or writing on behalf of the product at conferences. They then treat these elite physicians’ enthusiasm as a proxy for commercial viability, a mistake I call the green light illusion.
The logic of engaging KOLs seems sound: if the world’s leading specialists are excited about a therapy, surely the market will follow their lead. But as a longtime commercial strategy consultant who has worked on the development and launch of over 125 new drugs, and currently managing partner at Litmys, I’ve seen this assumption, repeated across therapeutic areas and development cycles, contribute to some of the industry’s most expensive commercial disappointments.
The problem isn’t that KOLs lack value—they are genuinely indispensable for certain functions. The problem is that companies, particularly smaller ones, and investors routinely assume that KOL enthusiasm will result in a product’s future commercial success. That’s not necessarily the case.
Where reliance on KOLs pays off—and where it can mislead
KOLs are essential in clinical trial design, where their understanding of disease heterogeneity, meaningful endpoints and enrollment realities is irreplaceable. They add comparable value in regulatory strategy and in medical education, translating complex mechanisms into practical prescribing frameworks for the broader physician community.
The error occurs when organizations extend that clinical credibility into their assessments of commercial potential—a fundamentally different discipline requiring perspectives that KOLs simply do not represent.
The disconnect between KOL enthusiasm and market performance isn’t a matter of intellectual honesty or individual failing. It’s structural. KOLs practice in rarefied environments—academic medical centers and specialty referral practices—that bear little resemblance to the community settings where most day-to-day prescribing occurs. A thought leader managing 100 patients with a rare condition annually shapes the opinion of a physician managing perhaps five, but KOLs may have little understanding of these community providers’ decision-making calculus, including time constraints, payer restrictions, reimbursement complexity and adherence concerns. The community physician, multiplied across thousands of practices, drives the volume that determines commercial success.
Despite their prominence, KOLs themselves may have little impact on uptake. Practicing physicians who read these leaders’ publications or hear them on a podcast or podium will listen but may discount their enthusiasm as they recognize KOLs are often paid consultants to companies.
The PCSK9 inhibitor launch illustrates this gap. When Amgen’s Repatha and Regeneron’s Praluent reached the market in 2015, cardiovascular KOLs were effusive—and on scientific grounds, this was entirely justified. What they failed to anticipate was the payer prior authorization gauntlet that community cardiologists and primary care physicians would face. The prescribing pathway proved too burdensome relative to existing options and uptake was profoundly disappointing for years.
KOLs the companies consulted also underestimated how difficult it would be to persuade patients to start an injectable therapy when benefits are neither immediately visible nor felt. The performance gap ran into billions of dollars for both manufacturers, with first year combined revenues of only $257 million rather than the blockbuster totals that had been forecasted.
KOLs also see the most complex, refractory patients—precisely those most likely to benefit from novel therapies. This selection bias inflates their perception of a drug’s applicable population. When they describe a therapy as “practice-changing,” they may be speaking accurately about their own practices, not the average community physician’s office.
For example, KOL enthusiasm for the CAR T therapies Kymriah (Novartis) and Yescarta (Kite Pharmaceutical), both initially approved in 2017, was clinically warranted—response rates in refractory hematologic malignancies were remarkable. But the academic centers where KOLs practiced were also the only settings equipped to deliver these therapies. Community oncologists and regional cancer center administrators held a fundamentally different view of feasibility. The geographic, financial and logistical burdens preventing eligible patients from reaching certified treatment centers never adequately registered in KOL assessments, and uptake consistently lagged early projections.
Financial entanglement compounds the distortion. Consulting agreements, advisory board fees and speaking honoraria create incentive structures that are difficult to neutralize. Human psychology makes it nearly impossible to remain objective about something one has personally championed and received compensation to advocate for.
Perhaps most consequentially, KOLs almost never predict failure. The systemic incentive runs entirely in one direction: enthusiasm preserves consulting relationships and trial invitations; skepticism does not. The result is a self-selective feedback loop where the KOL community that thrives is disproportionately composed of enthusiasts.
The due diligence standard the industry needs
The consequences of conflating clinical and commercial signals are particularly acute in investment due diligence. Investors evaluating late-stage assets routinely commission KOL interview programs and treat favorable readouts as positive commercial signals. But while KOL interviews can help assess trial design quality, endpoint validity and mechanism plausibility as part of clinical diligence, these components do not comprise commercial diligence, and the two should never be conflated.
Rigorous commercial diligence requires primary research across three constituencies that KOLs cannot represent:
- Community physicians reveal the reality of prescribing behavior at scale—the workflow constraints, electronic health record friction and clinical threshold at which a new therapy actually displaces current practice. Their view of a product’s differentiation is frequently far more skeptical, and far more accurate, than the KOL consensus.
- Payers reveal the access architecture governing real-world uptake: formulary positioning, prior authorization criteria, step therapy requirements and the net price corridor the market will actually bear. In therapeutically complex areas, payer research is not a commercial nicety—it is a prerequisite for any credible forecast.
- Patients reveal the adherence economics determining whether clinical efficacy translates into sustained real-world utilization. Side effect tolerability, administration burden and financial barriers routinely diverge from what KOLs observe in their closely monitored populations.
The standard should be explicit and consistently applied: any commercial forecast that cannot demonstrate primary research across all three constituencies should be treated as incomplete, regardless of how favorable the KOL program was. Frameworks like the RAMPx model, which evaluates new products on 12 proven adoption factors, exist precisely to institutionalize this discipline, creating a structured research sequence across the constituencies that uncovers factors impacting future prescribing.
Investors should ask directly during diligence: What community physician research was conducted, with how many respondents and in what practice settings? How many payer decision-makers were interviewed? What patient research informed the adherence assumptions? If the answers center on KOL advisory boards and thought leader interviews, the commercial case has not been made. It has simply been asserted by the people least positioned to make it objectively.
Recalibrating the signal
The KOL paradox is ultimately a governance and methodology failure, a tendency to let the most prominent voices in a therapeutic area stand in for the more dispersed, harder-to-reach perspectives that actually determine commercial outcomes. KOLs are easier to identify, easier to convene, and far more willing to engage than the payer medical director juggling a formulary review or the community internist who spends an average of 15.7 minutes per patient and is often incentivized to see as many patients per day as possible. KOL enthusiasm is also very gratifying to receive, which creates institutional pressure to treat it as meaningful.
Correcting the green light illusion requires not less respect for clinical expertise, but a clearer commitment to separating what KOLs can tell you from what only practicing physicians and patients can. Use them to help you build a better product. Build the commercial case supporting the product’s potential somewhere else.
