May / June 2019 by Healthcare Sales and Marketing Magazine

™ MAY/JUNE 2019

the publication for healthcare sales & marketing leaders™

OUR ANNUAL SALES AND MARKETING SALARY SURVEY IN THIS ISSUE Our Annual Compensation Survey Astellas U.S. President on Purpose, Pricing, and Better Access to Healthcare Alkermes VP on Hiring A Team with a Personal Connection Boston Scientific, Sanofi and Other Execs on the State of Healthcare Marketing Novartis, Takeda and other Innovators are Awarded What Healthcare Execs Want Deloitte: 2019 Global Life Sciences Outlook

FINDING EMOTIONS IN EVERY MOLECULE, CELL, PATHOGEN, AND ANTIBODY At AbelsonTaylor, we get emotional about science. For us, there’s real emotion buried in everything from molecules to K-M curves. So we get down to the cellular level to find emotion in the science that lets us tell a human story. One that HCPs will connect with. Because we’re not just inspired by science— we feel the data.

the publication for healthcare sales & marketing leaders™

TABLE OF CONTENTS Publisher’s Letter..............................................................................................................................................4 Editor’s Letter.....................................................................................................................................................5 Editorial Board....................................................................................................................................................7

ARTICLES Spotlight: Astellas U.S. President, Percival Barretto-Ko, on Purpose, Pricing, and Better Access to Healthcare..................................................................................................................9 Roundtable: Boston Scientific, Geistlich, Sanofi and Veeva Execs on the Marketing Landscape........................................................................................................................ 15 Annual Compensation and Salary Survey by Jacobs Management Group.................................. 23 2019 Global Life Sciences Outlook by Deloitte..................................................................................... 33 Novartis, Takeda and Others Win Innovation Awards...................................................................... 43 Industry Trends: By The Numbers............................................................................................................49 Great Minds: Alkermes VP, Greg Apostol, on How to Create a Better Team.............................. 51 Motivideos: To Use In Your Meetings..................................................................................................... 55 Pulse Report: What Are Healthcare Execs Saying?............................................................................ 59 Merck, Shire, and other Execs on ‘Why I Work in Healthcare’........................................................ 67

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Publisher’s Letter

Compensation and the Health of the Industry In this issue you’ll find the Jacobs Management Compensation and Hiring Survey. Every year it’s one of our most-read articles, and for good reason. Everyone wants to know how they’re doing compared to others, and how their sector is changing in terms of size and compensation.

CARI KRAFT

But there’s a lot more to the story than just dollars and size. In a time of significant change throughout the economy, these metrics are indicative of a lot of factors that influence nearly every other industry in the country.

All of this is part and parcel of what’s revealed here in our charts. Both sales forces and marketing teams are growing in size. The problem of open positions, and the enormous cost they impose on companies, remains high and has proven to be consistent year over year. Healthcare vendors’ sales forces have the highest growth rate, and that is probably an indication of our economy as those are the first to be added and the first to be cut. Another interesting statistic is the cost of a bad hire. Last year, was the first time we ran this in the survey and we had to double check the results. This year proves that those numbers were right in line. The average cost of a bad sales hire is over $60k and a bad marketing hire is over $70k. So we offer our thanks to the hundreds of people at more than 500 companies who have given us these insights into compensation and its part in the bigger picture. And always, please keep the feedback coming. It all goes to making the magazine better for all of us.

Cari Kraft, Publisher

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HS&M MAY/JUNE 2019 | 4

Letter from the Editor

A World Without What? There’s an interesting idea circulating at the top tier of healthcare: a world without disease. Its most visible champion is Johnson & Johnson, which has an initiative by that name, headed by Cat Oyler, Global Head of External Innovation Strategy and Operations. But others are also on the bandwagon, and it’s inspiring. At first, this seems to fly in the face of a common misperception about our industry. What would all those profitable companies do if there were no disease? They’d go broke! Hardly. In fact, the goal is largely based on the idea of preventive care, something the NEIL GREENBERG industry is also investing in more and more. Obviously, this isn’t going to happen overnight, nor is it going to be the responsibility only of healthcare companies. It will require governments, payers, academia and patient organizations working in concert. J&J has kicked off this goal with a series of Quickfire Challenges, offering grant help to various entrepreneurs, companies and organizations in numerous areas of healthcare: perioperative care, to support nursing skills development and develop nursing leaders; “Reimagining Respiratory Protection,” to protect the public from infectious agents and the threat of pandemics; the First 1000 Days challenge for prevention and interception of childhood disease and disorders; a Carcinogenic Exposure Meter challenge to reduce tobacco use among young people; and many more, in devices, mobile wellness and other areas. In a blog, Cat’s colleague Ben Wiegand, Global Head, World Without Disease Accelerator at Janssen Research & Development, writes “We’re calling for ideas and innovations from…entrepreneurs, researchers, start-ups, tech …We’re seeking the best science and the brightest minds …and the latest in digital technology to help us disrupt the existing health paradigm by shifting from a model of diagnose and treat to one of predict and preempt.” You can see the video here. “We imagine a time when widespread disease is a historical artifact,” says Cat. “We have the capabilities and we have the responsibility, to free the world from disease.” And that’s the industry you proudly work for. That’s your Why for today. We try to keep up with all this, and bring you the people who have a grasp on change. We hope that it will be informative, and assist you in furthering the work you do every day. Let us know what topics will be most useful to you!

Neil Greenberg, Editor To become an HS&M contributing author or provide feedback, please email me at ngreenberg@hsandm.com.

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THERE ARE SOME THINGS PEOPLE JUST WON’T TELL YOU BUT THEY’LL TELL US IN CONFIDENCE. AND WE’LL TELL YOU. There are a lot of opinions people never offer you about your company. What the pain is. What you could be doing better. What they think of your competition. How to talk to them effectively. Big corporations get these answers through expensive research. Small to medium-sized companies don’t have that luxury. That’s why we created the Private Process . It’s a quick, cost-effective way of compiling information that people will offer us in complete confidence. Then we assess the results and give you the insight you need to adapt your sales and marketing messages accordingly. ©

For details on how the Private Process works, and the kinds of answers you can get, contact us now at ngreenberg@hsandm.com.

™

Editorial Board

the publication for healthcare sales & marketing leaders™

Chris Bergstrom Publisher Cari Kraft Editor Neil Greenberg Contributing Editor Jill Donahue Creative Director Hedy Sirico Digital News Rick Cataldo Digital News Chris Manning Associate Publisher Natalie Newcamp EDITORIAL BOARD: Kristen Sharron-Albright Head of Marketing at Noven Pharmaceuticals Chris Bergstrom Associate Director, Digital Health Expert at Boston Consulting Group Sebastian “Sebby” Borriello Vice President, Chief Commercial Officer SK Life Science Lewis Chapman Vice President, Global Commercial Operations AllCells, LLC Maria Finlay, MBA Associate Director of Oncology Marketing, Teva Oncology Nick Gurreri Vice President New Products at Alexion Pharmaceuticals, Inc. Bob Roda VP and General Manager at BD

Associate Director, Digital Health Expert at Boston Consulting Group Chris brings almost two decades of commercial expertise as an entrepreneurial executive at large medical device and high-growth digital health companies, and he provides “on the ground” advice for implementing digital health solutions. He currently serves as the expert on digital health at The Boston Consulting Group (BCG). Before joining BCG, Chris was the chief commercial officer (CCO) at WellDoc, a pioneer in digital health. He also held progressive roles at P&G, Roche, and Becton Dickinson. Chris was a senior advisor to several digital health innovators, including MyOwnMed, LiftOff Health, HelpAround, Heart Beam, iSageRx, and Alere Home Monitoring. He also advised the Leona Helmsley Charitable Trust and the Saatchi & Saatchi Wellness Board. Chris holds two digital health patents and has won multiple awards.

Sebastian “Sebby” Borriello Vice President, Chief Commercial Officer SK Life Science Sebby is currently service as the Vice President, Chief Commercial Officer at SK Life Science. Sebby’s career has included executive sales and marketing positions at Cempra, Mentor Worldwide LLC, Johnson & Johnson Healthcare Systems Inc., Ethicon, Inc. and OrthoMcNeil Pharmaceuticals, Inc. Sebby received his B.A. in Public Administration from St. John’s University in ‘81, and received his M.S. in Organizational Dynamics from the University of Pennsylvania in 2001.

Maria Finlay, MBA

CL Media is not responsible for any unsolicited contributions of any type. Unless otherwise agreed in writing, CL Media retains all rights on material published in HS&M for a period of one year after publication and reprint rights after that period expires. Email ckraft@hsandm.com.

Director of Channel Marketing, Incyte

To advertise in HS&M, please contact Natalie Newcamp at nnewcamp@hsandm.com

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Maria has over 20 years of commercial marketing, sales leadership, women’s leadership and operations experience. She has led multiple brand marketing and cross-functional teams at Johnson & Johnson, AstraZeneca and Teva Oncology before joining Incyte; where she is in charge of access and reimbursement strategies and tactics, advancing impact with payers, PBMs, state societies, federal channel, pathways, GPOs, community oncology strategic accounts, and hospital system business stakeholders.

Bob Roda

Editorial Board

President and CEO, Menarini Silicon Biosystems Bob Roda is a senior commercial executive with extensive experience in delivering business growth and profit in the medtech and diagnostics sectors of healthcare. He currently serves as the President and CEO of Menarini Silicon Biosystems, where he is responsible for driving the commercialization of novel cancer diagnostics. Previously, Bob held a variety of roles of increasing commercial responsibility at Becton Dickinson. Most recently, he was VP and General Manager of the MPS business unit as well as leading the commercial integration of the CareFusion acquisition. Bob also had a successful career within the MD&D sector at Johnson & Johnson. His diverse background includes positions in business development and senior leadership roles in sales and marketing at Johnson & Johnson Medical, Inc., Ethicon, Inc. and Ortho-Clinical Diagnostics. While at J&J, Bob also served as the executive sponsor of the Commercial Leadership Development Program as well as the chair of the VP Marketing Council for all of MD&D. Bob is a highly respected, successful global leader with proven abilities in diverse disciplines. He holds a Bachelor of Arts degree from The College of Business Administration at the University of Rhode Island.

Lewis Chapman Vice President, Global Commercial Operations, AllCells, LLC Lewis Chapman is currently the Vice President, Global Operations at AllCells, LLC.Â He has spent over thirty years in health care management. He served as VP of Global Strategic Marketing at BioMarin Pharmaceutical from 2007 to 2012, where he was responsible for strategic marketing and product portfolio analyses, and implemented medical education, brand enhancement and sales support programs on a worldwide basis. He oversaw the global launch of Kuvan, which in the U.S. was 112% to budget in 2008, the first year on the market.Â Previously, he worked with Alpha Inntech Corporation as Vice President Global Sales and Marketing, where global sales grew 26% in 2004 and 22% in 2005 under his leadership. Lewis started his career with Eli Lilly & Company, with roles at Syntex and Genentech, where he was responsible for the global commercial launch of Activase (t-PA), the largest biopharm product launch in the history of the industry up to that time (first year sales $187 million).

Nick Gurreri Vice President New Products, Alexion Pharmaceuticals, Inc. Nick Gurreri is a business leader and General Manager with over 25 years of consistently achievinghigh performance and profitability through strong leadership and cohesive team building in the biopharmaceutical and medical device industries. Nick has held executive positions at Medgenics, Insmed, Pfizer, Pharmacia and Bristol-Myers Squibb. Nick received a BS in Mechanical Engineeringfrom the University of Delaware, and also acquired a Master of Science in Information Assurance at Carnegie Mellon University.

Kristen Sharron-Albright Head of Marketing, Noven Pharmaceuticals Kristen Sharron-Albright, the current Head of Marketing at Noven Pharmaceuticals, was until recently VP Sales and Marketing, Anti-Infective Marketing and Institutional Sales Specialty Care Business Unit at Pfizer. She is an experienced business leader with 20 years of experience in the pharmaceutical and biotechnology industries. She has a strong track record of delivering results in highly competitive and complex markets. Starting her career in sales at Eli Lilly, she then held positions of increasing responsibility at Lilly, Neurogen, and Pfizer, where she was responsible for sales and marketing in a franchise business model. In her spare time she volunteers, serves on the leadership committee for her church, and enjoys hiking.

HS&M MAY/JUNE 2019 | 8

EXECUTIVE SPOTLIGHT

Astellas U.S. President Percival Barretto-Ko: Better Access to Healthcare is the Goal Some of the content for this article comes from eyeforpharma, whom we thank for their assistance. Percival Barretto-Ko, Astellas U.S. President, comes from a background as a chemistry and biology teacher at a high school in a small town just outside of Boston. He credits his time spent in the classroom as opening his eyes to the possibilities of science. It also equipped him with the tools needed for leadership.

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“Authentic storytelling is at the heart of teaching,” he says. “As a science teacher, to engage students in the world of STEM, it’s important that you paint a convincing story that excites and motivates them — stories that show the value of science in their lives. This inspires them, crystallizing and painting a vision so that they will gain a better understanding.”

In his role at Astellas, he implements the same philosophy in developing vision and strategy for Astellas employees. He is intent on creating a vivid image of how Astellas will continue to create and deliver value for patients and envision their path forward. “This ensures we have a collective story in mind as a patient-centric organization. Externally, it’s important that

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EXECUTIVE SPOTLIGHT

I continually share Astellas’ story with external stakeholders, about who we are, what we stand for, and what we believe in.” EARLY INFLUENCES Following business school, Barretto-Ko joined Roche, where he held commercial leadership positions across a spectrum of therapeutic areas, ranging from oncology to virology. In 2005, he joined Astellas Pharma and after occupying several leadership roles in the US and Europe, he was appointed as President of Astellas Americas in March of 2018, overseeing Astellas’ operations across the region. Plugging the gap between innovation and access is his top priority. Barretto-Ko’s move from academia to the life science industry was driven in part by this motivation. “Growing up in the Philippines, I saw firsthand what it means to lack access to healthcare. Without a doubt, this early perspective — as well as the experiences I’ve had professionally in Europe and in other regions— has shaped my philosophy about the importance of both innovation and access to quality care. Innovation must be paired with access, and the combination of the two is what creates value for patients. Innovation on its own serves no purpose. It’s a personal mission for me.”

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“Growing up in the Philippines, I saw firsthand what it means to lack access to healthcare. This early perspective…has shaped my philosophy about the importance of both innovation and access to quality care.” While he is encouraged by the innovative therapies that have come out over the last 10 years, he also acknowledges that getting them to patients remains a grave challenge. “Part of my focus is to work with my colleagues and external stakeholders to ensure that our healthcare system is able to keep pace with the science. This is the essence of value,” he says. LEARNING LEADERSHIP At Roche, Barretto-Ko was part of their Leadership Development Program, giving him a unique opportunity to experience a variety of roles. “In addition, I was blessed to have influential mentors who guided me along the way. A lesson these mentors taught me early on was to take risks in my career and to pursue roles that, at first, may seem like lateral moves, but were new experiences that would stretch me in different ways.”

“As a result, in 2003, I jumped at the opportunity to do an expat role at Roche UK, responsible for the hematology franchise. Within weeks of taking on my new role, I found myself in an infusion ward in Manchester, meeting several non-Hodgkin’s lymphoma patients undergoing treatment. At that moment, my career shifted from a job to something much, much more.” UNLOCKING VALUE Barretto-Ko outlines Astellas’ approach as focusing on three pillars: patients, people and performance. “If you have a dogged, tenacious focus on the patient, and at the same time you have the right people and culture in place, the performance will follow. By focusing on the patient and the people, performance will surely follow.” The Astellas business model is centered around “value” — creating value through innovation and through enhanced services and capabilities for patients. “We spend 100 percent of our time and effort creating and delivering value for patients every day. This means moving from a massmarket approach to individualized and personalized care, measuring health outcomes, utilizing realworld informatics, listening to and learning from patients, and creating greater transparency in the system.” Last year, Astellas launched the “value gene,” a global strategic plan to translate innovation into value for patients. It delves beneath the surface of value and find ways to practically apply it to patients.

Astellas launched the “value gene,” a global strategic plan to translate innovation into value for patients. Astellas is starting to structure clinical trials, research, development, and partnerships around this philosophy, says BarrettoKo. “What is the real value to the patient? How does our work impact their lives? Not just from an efficacy point of view, not just from a safety perspective, but from a psychosocial perspective, from an out-of-pocket perspective; from a logistics perspective.”

These holistic measures are essential to bringing value to patients. Additionally, Astellas recently announced the establishment of a new global division that is focused on the entirety of the patient experience. More broadly, patient experience includes all aspects of a patient’s care journey. The focus also extends to caregivers, who play an integral role in patient care, to better understanding and support of their experience. THROUGH THE PRISM OF THE PATIENT Since launching its patient experience organization, Astellas has made improvements to its clinical trial consent forms to help patients.

Astellas also understands that “no single entity can serve the patient fully and holistically” and that it needs to collaborate, internally and externally, with other key players in the healthcare system in ways that put the patient at the center. Their patient centricity function is dedicated to understanding patient needs through non-pharmaceutical focused collaborative projects with organizations that share similar aspirations and have the potential to deliver lasting effects for patients. To that end, Astellas has struck up a partnership with the Academy of Oncology Nurse and Patient Navigators (AONN+). “They play such a crucial role in navigating patients through a very complex

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EXECUTIVE SPOTLIGHT

web of obstacles, not just clinical but the entire holistic treatment,” says Barretto-Ko. “One of the things that we’re developing with them is an evidencebased oncology-specific navigation tool for patients. This is intended to help patients clarify some of the questions that they might have, and when you get a diagnosis of cancer, you have a lot of questions to deal with and so do the caregivers.” It will have the potential to determine the level of support cancer patients may need from their oncology team to help them better understand their disease, treatment options and to empower greater engagement in their care along their journey.

“One of the things that we’re developing… is an evidence-based oncology-specific navigation tool…to help patients clarify some of the questions that they might have.” When completed, the tool is intended to provide an opportunity to provide patients with the level of support that they need from a multidisciplinary oncology team. THE PROBLEM OF PRICING Unlike some healthcare systems in the world, the prescription drug marketplace in the U.S. places a high priority on both access and

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choice for patients. “This is an important differentiator and strength. At the same time, our system is overly complicated and opaque — resulting in patients paying more out of pocket. At Astellas, we are working collaboratively with many stakeholders to help evolve our system in ways that preserve the effectiveness of market-based competition while improving affordability for patients in need.” Barretto-Ko says that modernizing the Medicare prescription drug benefit (Part D) is a prime example. Part D has successfully provided affordable access to medicines for millions of seniors over the past 13 years, but the program has not kept pace with the state of the science. “Due to the benefit design, seniors in need of cutting-edge specialty medicines are now facing significant cost burdens. We believe this challenge can be addressed through targeted, constructive policy revisions.” “Astellas, like many of our peers, focuses on science. But the fruits of that science must be translated into affordable access and value for patients. We can invent anything in the lab, but if it doesn’t reach patients, then the system isn’t working. Striking the balance between future innovation and sustained access is our priority. This requires creativity and collaboration as we work to implement innovative solutions — with a consistent emphasis on reducing out-of-pocket costs, strengthening and protecting intellectual property, incorporating the patient voice from discovery to delivery, and

cultivating new partnerships with an open mind.” SHAPING A SUCCESSFUL COMMERCIAL ENTERPRISE Looking ahead to 2019 and beyond, Barretto-Ko believes the true value of innovation will continue to drive conversations across the board. He cites the political landscape in the US, where the Trump administration has made pricing a hotbutton topic. Similar conversations are driving policy decisions in Japan, Canada, Latin America and Europe.

“This is no passing thought. It’s a good thing because, at the end of the day, it is a discussion about the needs of the patient.” For Astellas, patient interests drive business goals and objectives. “For example, when we’re talking with employees about sales, we aim to translate that into the number of patients served, because it makes what we do real at the end of the day. Business results are important, but it’s the patients who we help that provides substance and meaning to our work and crystallizes who we are as a company.” “We are also empowering our people to make faster decisions and take calculated risks. For example, the patient centricity

team piloted two internal crossfunctional Results Accelerators, designed to fit within a 90-day timeframe and aimed at helping to achieve impactful results faster through enhanced collaboration and innovation. Results Accelerators are projects that can be completed in 30-60-90 days to deliver results that will have a significant impact to the organization.” A CULTURE OF PURPOSE “For any enterprise to thrive, it’s important that there’s a clarity of purpose, a purpose that resonates across the organization. At Astellas, we are focused on creating a culture that is truly patient-centric, so we must appropriately represent and reflect the communities where we live and where we work.

“Diversity and Inclusion is a key strategic priority for Astellas that enables us to pursue what we believe in as a company. Creating a culture of diverse perspectives is at the core of serving patients, and we embrace diversity and inclusion in all forms as represented by seven dynamic employee resource groups (ERGs).” Recently, they brought on board their first Head of D&I, Eloiza Domingo-Snyder, who is responsible for developing and implementing a sustainable Diversity and Inclusion strategy that is embedded in the fabric of the organization, reflecting and enhancing their culture and work environment.

GIVING BACK AS A COMPANY Looking back at his first year as president of Astellas US and what has been accomplished, BarrettoKo proudly reflects on the dedication of Astellas employees to the greater good through volunteer and community service efforts. “Our responsibility extends beyond our medical innovations — we hold ourselves accountable to our community and to those with whom we work and partner. Employees have volunteered more than 107,000 hours since 2005 to help address various community needs.” •

COMMENT

HS&M MAY/JUNE 2019 | 14

ROUNDTABLE

What’s Driving Today’s Healthcare Marketing? Execs from Sanofi, Geistlich, Boston Scientific and Veeva Our panel of experts: CHRISTIE BLAKELY Head of Sales & Marketing, USA (Medical & Surgery) Geistlich Pharma AG

SETH GOLDENBERG Vice President, Vault Med Device Suite Veeva

RYAN HARTMAN

CHAPMAN RICHARDSON

Global Group Director Marketing & Latin America Boston Scientific

Global Head of Data Consumerization Sanofi

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ROUNDTABLE Marketing teams today are not what they were five years ago, and probably not what they’ll be five years from now. There is less focus on product, and more on evidence and outcomes. There is increasing pressure to adopt and integrate digital data and solutions, and break down silos so data is more easily shared. There are more complex global regulatory guidelines to adapt to. Above all, there is the recognition that the whole industry, from the scientists and engineers who develop product, through to the sales and marketing teams, to the HCPs and, most importantly, the patients, are all part of a communications continuum that must be streamlined and made more efficient. Here with some insight into all that are our experts for this issue. What is the current point of view about how to improve patient adherence, given the billions of dollars lost to unfilled Rx, confusion about directions, poor reaction to side effects, and other influences that cause patients to go off their regimen? CHAPMAN RICHARDSON: This is all about managing the personal journeys of our patients. We all see the increasing investment in patient services programs across the industry and there is a ton of added human-power that comes with that. But manual interventions will never scale to cover patient segments with a population of “1”. To help each individual deal with their circumstances, we need real-time feedback from an ecosystem comprising sensors, apps and EHR. The barriers here are data privacy, software-as-a-medical-device (SAMD), disconnected EMRs, and of course the reimbursement model that accompanies it all. Building the right integrated team to cover all these components will be the only way to deliver success in the future for our patients. This is not a quick win with just the 17 | HS&M MAY/JUNE 2019

release of an app, but rather an evolutionary (or revolutionary) process that will need to help write new regulations, define new commercial models, and perhaps think of new ways to give data ownership back to the patient so they can connect the dots within their care network. SETH GOLDENBERG: Clinical trial design has evolved to allow companies capture and mine patient-specific outcomes. Patient preference is increasingly an endpoint in trials, which was not traditionally the case. Normally, a patient preference is not an endpoint in a trial. With the rise of patient advocacy groups, this is becoming more prevalent. Additionally, patient preference is correlated with adherence; when a patient is comfortable with a product and trusts the product, they will continue to use it, which is another marketable opportunity. Your product may have equivalent results, but if you have a stronger patient preference you have a better likelihood to increase market access.

How have marketing people been involved in enhancing the doctor/patient conversation, and assisting HCPs in educating patients, given the limited time they can devote to each person? CHRISTIE BLAKELY: We continually work to produce and disseminate engaging and educational content for patients and their caregivers, so that the physician can spend more time on their care and less time on educating the patient. For example, we provide a brochure for the patients (and their caregivers) that explains the product and their disease state in layman’s terms, and then we direct them to our website where we are able to provide a broader array of content, videos and testimonials. It is our goal to put the patient at ease (to the best of our ability) so that they can focus on their treatment and being compliant with physician instructions. There is no question that high patient compliance with treatment protocols increases the likelihood of healing and/or positive patient outcomes. It is also important for us to align our patient education content with the most appropriate search words that are used by patients and caregivers so that we appear in highly relevant search results. We track and modify our strategies based on thorough analytics so that we can adjust our SEO framework to best match what the patients are searching. This is an iterative and highly collaborative process between us and our website management company so that we are highly aligned relative to our strategies as compared to expected outcomes.

RYAN HARTMAN: In certain segments of our business, we have created content for physicians that enables them to educate their patients more easily. Many companies still devote much of their resources towards physician education. SETH GOLDENBERG: Marketing teams have evolved to become a more trusted and educational resource for their doctors. Bringing content and data to support the device is expected, and the marketing team is expected to educate the doctor on patient preferences and outcomes, not just on the deviceâ&#x20AC;&#x2122;s features. They focus not just on the overall clinical output, but layer in how to communicate to the patient about this product. The conversation has changed from device provider to doctor, educating the physicians to make them advocates for your product. What are the current and upcoming regulatory hurdles facing marketing, both here in the U.S. and in the EU? RYAN HARTMAN: The EU MDR is a big challenge for all companies right now. Plenty of resources being dedicated towards being compliant with it. SETH GOLDENBERG: The Sunshine Act was the biggest regulatory change for marketing. The expansion and extension of these requirements based on this regulation continues today. Transparency, access, and how you demonstrate that what youâ&#x20AC;&#x2122;re sharing with patients has gone through the right approval processes. Now that the Sunshine Act has landed, they will continue to build on this foundation. This puts a burden on marketing and sales to

POOR ADHERENCE

PRIVACY REGULATIONS

LOW AI ADOPTION

FEATURES/BENEFITS VS. EVIDENCE

ensure compliance. Eudamed is a publicly-accessible database that will be used to monitor the safety and performance of devices under the Medical Devices Regulation (MDR) and the In Vitro Diagnostic Medical Devices Regulation (IVDR) CHRISTIE BLAKELY: No question the biggest regulatory hurdles in the EU are the changes from the MDD to the MDR. Companies now have a very different set of regulations to conform to, and I believe we will see many product discontinued in the EU because it is too costly or too time consuming to comply with the new MDR. I believe we will see more products gaining clearance in the US market first with clinical studies designed to also meet the requirements of the MDR. If conducted correctly, companies could be able to leverage data from a single clinical study for both US and EU registration or post-market surveillance requirements. CHAPMAN RICHARDSON: My biased perspective, being the head of data governance at Sanofi, is that the spread of data privacy

regulations around the world are not just restricting what we can do with personal data, but are also creating a level of fear in the industry that may stop teams from even trying new solutions because of the new risk they bring. Examples like GDPR in Europe and CCPA in California show us that people, including patients and HCPs, are upset about how their personal data is being handled and want more accountability and recourse in the event their data is used outside of their direct consent. Ensuring we have the proper data governance in place to clearly understand the personal data we capture and the respective consent will be the only way we will gain the confidence to make better marketing decisions at a faster pace. Without data governance bringing together data owners, data managers, IT, data privacy, security, legal and other contributors, the personal data necessary for targeted marketing will not be captured because of the inherent risk. Even if the data is captured, then the usage will be limited because our teams will go into a death spiral, asking whether or not we can act on that HS&M MAY/JUNE 2019 | 18

ROUNDTABLE data. Having a clear and common understanding on both the customer side and on our side will be the only way to successfully move forward. Is AI being implemented in any practical way at your organization to enhance your marketing efforts? If not, why and what is needed yet to make AI a reality in commercial life sciences? SETH GOLDENBERG: Demand for AI has been significant in life sciences, as companies are capturing increasing volumes of data that they are looking to glean insights from. The challenge for companies is getting the data from disparate sources into an environment where AI tools can then be used. Numerous integrations from other sources need to be done and these data also need to be of high quality to get good results (the proverbial garbage in/garbage out). Once the data is cleaned and organized AI tools can then be used to get new insights from these large data sets. These insights can inform not only marketing, but also R&D giving insights into continued patient/ HCP challenges. CHAPMAN RICHARDSON: Iâ&#x20AC;&#x2122;ve seen advanced analytics and data science be applied to marketing across many different channels. The insights we uncover help inform our global and local teams on what messages to deliver to which customer segments at the right time and on the right channel. This is executed via applied business rules in our marketing automation systems to act in real-time based on customer behavior (or absence thereof), shifts in market dynamics, or other environmental changes. But I see an untapped area here. 19 | HS&M MAY/JUNE 2019

One of the key supporting functional areas for marketing is compliance. All other functions are automating with machine learning and robotics. But with compliance, it is still a people-power function with qualitative spot-checks done at a point in time. Both qualitative and quantitative analysis in realtime is possible and could allow for more creative marketing solutions if the confidence is there to ensure we can monitor these with the associated compliance. This is a subject area where Iâ&#x20AC;&#x2122;m starting to see growth and could be a great example where the rising AI tide raises all ships. CHRISTIE BLAKELY: We are utilizing augmented reality technologies in very exciting ways. Most recently, they have introduced the ability to place your smart phone over a static image in a brochure (or on any printed piece for that matter) and with the right app loaded onto your phone, a video begins playing at the sight of the static image. This is a very powerful approach to enhancing static content in printed pieces with the broader functionality of digital content, including video. We will be leveraging this technology for various targeted users, including physicians, patients, and other stakeholders/decision-makers in ways that just a few years ago were not available to marketeers. RYAN HARTMAN: I havenâ&#x20AC;&#x2122;t seen AI have a dramatic impact on marketing yet. I have seen it begin to move into physician practice. Still a long way to go but some day, having a computer-driven algorithm assist you in diagnosis of a disease will be real.

How has the growing focus on precision medicines changed your approach to marketing strategy? For example, are you seeing an increased effort to bring medical affairs and marketing/sales together to work more collaboratively in an effort to provide greater scientific education? CHRISTIE BLAKELY: There is no question that scientific education is a key cornerstone in driving product adoption. Given all of the new metrics by which physicians are measured, they are demanding to understand the subtle nuances of your product or technology and, more importantly, how those differences can drive improved patient outcomes. No longer can marketeers rely on features and benefits. Now they must build in the scientific evidence to support the claims. Increasingly, this means that medical, clinical and scientific affairs leaders must be a part of the team early on and require a seat at the table when developing go to market strategies. If these key elements are overlooked early in the strategy development process, the company can spend precious time after product launch building their war chest of data to support the precise technologies that are being placed into the market. As a marketing leader, I strongly recommend a close relationship with scientific education to partner in the development of content for the sales organization so that the sales representatives can confidently target, message and position the product to physicians. In addition, leveraging the medical, clinical and scientific functions in your organization to develop educational programs which include content

Moving Forward MANAGING THE PATIENT JOURNEY

QUANT/QUAL ANALYSIS

TRANSPARENCY AND ACCESS

that is relevant to and demanded by targeted physicians is smart business, and an optimal way to improve product adoption. SETH GOLDENBERG: Yes, there is certainly a trend to train sales teams in patient preferences and experiences. More and more sales teams are becoming or including MSLs (medical science liaisons). This is driving the adoption of more unified systems where commercial and R&D can access all the information they need in one place. This single source of truth for patient preference data and documentation increases visibility, consistency, and collaboration. Most of the major life sciences companies have introduced the position of “chief digital officer” in the last year. And Deloitte recently assessed the digital maturity of biopharma companies based on a survey conducted with the MIT Sloan Management Review and found that about 25% of biopharma executives are in the early stages of their digital

journey and 55% are developing their digital capabilities. Only 20% of respondents say their companies are digitally mature. How has or how will digital transformation at your organization change your marketing approach? What communications channels will rise to the forefront? CHAPMAN RICHARDSON: Sanofi, as with many pharma companies, has invested significantly in digital as presented in our quarterly reports. The digital “plumbing” is there in most markets and now it needs to be taken advantage of in an integrated fashion. Execution in one channel is crawling. Execution across channels in an orchestrated fashion is walking. Do this in an automated way, analyzing feedback, informing the model and improving — now you are running. This is what most consumer goods companies do today and this is where our industry must go. I think this is quite obvious, but why is it so hard? You can list many barriers but in my

INTEGRATING TEAMS

experience, scale is the biggest one. Any brand or market can do this, but can they do it everywhere and consistently? So driving this as a top-down strategy and embedding digital maturity measures in brand plans will make this happen. Just know that the first attempt (and perhaps even second) will not stick. Staying power will be crucial. SETH GOLDENBERG: We are supporting the evolving role of a marketer to engage online and deliver a personalized and custom experience for the sales journey. The two-way conversation between sales and their prospects is critical for success. Education, training, and ongoing feedback in med device sales will ensure adoption and market access. There are studies that show that if a doctor doesn’t use a device within the first 30 days of purchasing, they never will use it at all. This puts an increased pressure on sales to ensure there is an ongoing dialogue on the value and patient preference of the product. •

HS&M MAY/JUNE 2019 | 20

ROUNDTABLE

MEET OUR PANEL OF EXPERTS CHRISTIE BLAKELY

CHAPMAN RICHARDSON

Head of Sales & Marketing, USA (Medical & Surgery) Geistlich Pharma AG

Global Head of Data Consumerization Sanofi

Before taking her position at Geistlich, Christie spent several years as President of Agility Performance Group, where she consulted with companies across the medical device sector on global commercialization strategies, business development, new technology assessment, customer loyalty and engagement, medical education, healthcare compliance and sales training. She has also held positions as VP Marketing, Sports Medicine and Surgical Specialties, VP Customer Relations and Health Care Compliance, and VP Sports Medicine Marketing at RTI Surgical; Customer Experience Management at Zimmer; Director, Hip Marketing at Exactech; and Senior Product Manager at Smith & Nephew Orthopaedics. Christie.Blakely@geistlich.com

GEISTLICH PHARMA is specialized in biomaterials for the regeneration of bone, cartilage and tissue, and develops and manufactures medical devices and pharmaceuticals with the goal of giving patients a better quality of life. Their products are marketed via more than 60 distribution partners worldwide as well as ten affiliates: UK, Germany, Italy, France and China, Brazil, South Korea, North America, Australia and India. The company has a global workforce of around 500. With the pioneering products Geistlich Bio-Oss® and Geistlich Bio-Gide®, the company has decisively shaped the market for regenerative biomaterials for decades.

21 | HS&M MAY/JUNE 2019

Chapman is the Global Head of Data Consumerization at Sanofi and is all about extracting value from enterprise data assets. His current responsibilities include defining the overall EIM Strategy for Sanofi with strategic imperatives around Master Data and Metadata Management, Data Quality, and Data Governance with an emphasis on customer/patient engagement. Prior to joining Sanofi, Chapman was at Novartis for over 10 years, mostly serving in global transformational roles in the areas of CRM, Digital Marketing, and Patient Services. He most recently translated his digital engagement experiences into value for personalized medicine in the revolutionary CAR-T therapeutic space. He began his career in consulting with Accenture, IQVIA, and CapGemini where he leveraged design thinking to bring innovation to life for his clients. Chapman.Richardson@sanofi.com

SANOFI in the United States employs more than 14,000 professionals. Sanofi US comprises five business units that focus on human vaccines, rare diseases, multiple sclerosis, oncology, immunology, infectious diseases, diabetes and cardiovascular solutions, consumer healthcare, established prescription products and generics. Worldwide, more than 100,000 people at Sanofi in more than 100 countries are dedicated to making a difference in patients’ daily lives, wherever they live, and enabling them to enjoy a healthier life.

SETH GOLDENBERG Vice President, Vault Med Device Suite Veeva

Seth is responsible for the customer engagement, market adoption, and product development strategy in the medical device industry for Veeva Vault. Prior to his position there, he was a principal of 2G Consulting; Executive Director of Scientific Services and Strategy at Golin; Director of Product Development Strategy and Global Regulatory Strategy at NAMSA, the premier global medical research organization; President of Asia Pacific Bio Intelligence, a pharma, medical device and healthcare consulting company; and a regulatory chemist at the FDA.

VEEVA’S industry cloud solutions provide data, software, services and an extensive ecosystem of partners to support critical functions for healthcare companies, from R&D through commercial. Veeva helps companies of all sizes bring products to market faster and more efficiently, and maintain compliance.

RYAN HARTMAN Global Group Director Marketing & Latin America Boston Scientific

At Boston Scientific, Ryan is responsible for Imaging, Infection Prevention, Services & Solutions, Strategic Planning, Global Integrated Communications, Ambulatory Surgery Channel, and LATAM Marketing. He has also been Global Director of Marketing for Endoscopy, Global Group Marketing Manager for Pancreatico Biliary, National Market Development Manager, Market Development Manager and Regional Sales Manager for seven territories. Ryan.Hartman@bsci.com

BOSTON SCIENTIFIC has over 13,000 life-changing products and 29,000 employees at 33 offices around the world, with commercial representation in 125+ countries, affecting the lives of more than 25 million patients. It has shown leadership in endoscopy, interventional cardiology, neuromodulation, peripheral interventions, rhythm management, urology and pelvic health.

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COMMENT HS&M MAY/JUNE 2019 | 22

COMPENSATION AND HIRING

HOW AM I DOING? Annual Compensation Survey

The Jacobs Management Group Salary Survey Healthcare is a fascinating industry. While the winds of chaos swirl around the economy, our industry continues to show positive signs in many areas. Yes, compensation for one group may decline, but for others it continues to grow. The size of sales forces changes from year to year, but overall the job market remains strong. There are always political forces forming around one issue or another, but our people march forward, intent on improving care, discovering new ways to help patients, creating efficiencies and building bridges with hospitals, pharmacies, payers and other players they interact with. These statistics, once again gathered from over 600 people at more than 500 companies, give you a current snapshot of how your colleagues are doing in terms of compensation: the 2019 Jacobs Management Salary Survey results. From Jacobs Management Group CEO and HS&M Publisher Cari Kraft: The 2019 results show solid compensation figures in the midst of questions regarding our overall

23 | HS&M MAY/JUNE 2019

industry economics. Here are a few of the highlights about how sectors are changing, how compensation is affected, and where to expect growth: • Sales force growth increased to 6% across all sectors, even better than last year’s number of 5.5%. The healthcare vendor sector topped others at 7.5%. This is a change from our last survey which had the sectors growing in the order of biotech/medical device, pharma, and healthcare vendor. • Medical device reps continue to stay in the lead in compensation, with totals averaging over $250K, even while overall rep compensation was an average of 204K. • Open positions continue to be a pressing problem, especially in a full-employment economy. Each month a sales position remains open costs the company $60,875, a 20% increase over last year’s $49,024. Open marketing positions cost $38,750 on average. • There are a lot of changes in the growth of teams. Pharmaceutical marketing growth is up to 18%

from 10% last year; medical device growth has dropped from 8% to 6%; healthcare vendor numbers have gone from 1% last time to 6% this year. Only biotech has remained steady at 4%. SURVEY POPULATION This report summarizes the results from the Jacobs Management Group, Inc. Compensation Survey conducted in 2019. The target audience, as in the past years, was key leaders in the medical device, pharmaceutical and biotechnology industries with a focus in the marketing and sales arena. Results were compiled from over 600 individual responses, representing over 500 companies. Companies ranged in size from over $100B to under $10M and were categorized into four main sectors: pharmaceutical, biotechnology, medical device, and healthcare vendor. 62% of respondents had titles of manager or above

CLICK HERE FOR FULL SURVEY RESULTS

What do over of the top 20 pharmaceutical, biotech, and medical device companies have in common? They choose Jacobs Management Group as their recruiting partner.

WE ARE PLEASED TO PROVIDE THE RESULTS OF OUR 2019 COMPENSATION REPORT Is the position you are trying to fill competitive? Jacobs Management Group is pleased to offer you a full copy of our 2019 Compensation Report.

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COMPENSATION AND HIRING COMPANY SIZE

RESPONDENT BREAKDOWN

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POSITIVE CUSTOMER EXPERIENCE

Martina Flammer SVP, Customer Value Boehringer Ingelheim

Milind Kamkolkar CDO Cellarity Former CDO Sanofi

Zheng Yang Head of Technology, and Data Innovation, Customer Value Boehringer Ingelheim

Ramon Vega Head of Global Pharmaceutical Marketing IT Merck & Co.

Michael Seggev Senior Director of Marketing Teva Digital Health

Anish Shindore Head of Digital Acceleration Sanofi

Matt Smith Global Leader, Strategy, Digital & Operations Pfizer

Pralay Muhopadhyay Head of Late Stage IO, Strategy Lead AstraZeneca

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COMPENSATION AND HIRING GROWTH CONTINUES! The continued good news is that both sales and marketing teams are forecast to grow across all sectors. Sales force growth increased to 6% across all sectors, with the largest team growth of all sectors being healthcare vendor at 7.5% this year. This is a change from our last survey which had the industries growing in the order of biotech/medical device, pharma, and healthcare vendor. Pharmaceutical companies still have, on average, the largest number of reps per company, at an average of 935 reps, as compared with the average across all the healthcare sectors of 559. The timeframes for sales promotions remained the same at approximately four years and nine months, a slight increase year over year but a consistent metric for the past three survey sets which showed 4 Â˝ years. Average sales income increases approximately 5% per year.

AVERAGE SALES FORCE SIZE

% SALES FORCE GROWTH

Healthcare vendor sales growth has grown to 7.5%, followed by biotechnology with a steady growth rate at 6.2%, medical device at 5.6% and pharmaceutical at 4.8%.

27 | HS&M MAY/JUNE 2019

MARKETING TEAM GROWTH HOLDS STEADY AT 8%

BREAKDOWN OF MARKETING TEAM SIZES

Marketing teams continued to grow, holding a pace of 8%. The average marketing department now has a team of 161. The average training period for a marketing team member holds at close to three months. The typical marketing professional is moving up with last year’s report with an average of being in their position as compared to 2.8 in 2018. Marketing professional travel has decreased down to 27% travel, as compared with prior 31% from last year’s report.

PHARMACEUTICAL MARKETING TEAMS ARE CONTINUING TO EXPERIENCE THE FASTEST GROWTH Pharmaceutical marketing team growth has outpaced all other categories again. Pharmaceutical marketing growth is up to 18% from 10% in our last survey, while medical device growth has dropped from 8% to 6%. Biotech growth has remained steady at 4%. Healthcare vendor growth has increased dramatically from 1% to 6% this year.

% MARKETING TEAM GROWTH

HS&M MAY/JUNE 2019 | 28

COMPENSATION AND HIRING MARKETING DIRECTORS EARN OVER 71% MORE THAN PRODUCT MANAGERS MARKETING TEAM COMPENSATION COMPARISON

This year, marketing directors earn, on average, 71% more than product managers. In our last report the differential in base was at 50% and this year, 59% of the differential comes from base salary. Product managers’ bonuses are, on average, 16%, while marketing managers’ are 22%, and marketing directors’ are 25%. Product managers on average have a total compensation of $140K, marketing managers $175K, and marketing directors $239K, all increases from last year.

TOP MEDICAL DEVICE REPS MAINTAIN THE COMPENSATION LEAD Medical device reps have kept the lead in top rep compensation, with totals averaging over $250K. Biotech top rep compensation dropped to $164K. Across the board, top sales reps’ earnings dropped from an average of $217K to 204K, while first year reps’ earnings increased greatly to an average total of $132K over 123K. Top sales reps’ and first year reps’ base salaries differ by an average of $35K. Sales reps’ commission payment timing has hardly changed, as 40% of sales rep commissions are paid monthly, 53% are paid quarterly.

FIRST YEAR/TOP REP EARNING COMPARISON

29 | HS&M MAY/JUNE 2019

MONTHLY COST OF AN OPEN SALES POSITION

IT COSTS EVEN MORE $$$ TO LEAVE POSITIONS OPEN Each month a sales position remains open costs the company $60,875, which increased over $11K per month year over year. The average cost of hiring the wrong sales person increased 4K to close to 84k this year.

MONTHLY COST OF AN OPEN MARKETING POSITION

Each month a marketing position remains open costs the company $38,750 down from just over $50,000 in our prior report. The cost of hiring the wrong marketing person is almost double, costing a little over $75,500.

75-100K 9%

50-74K 11%

HS&M MAY/JUNE 2019 | 30

COMPENSATION AND HIRING

AND IT TAKES ON AVERAGE 4.5 MONTHS FOR SALES HIRES AND 5 MONTHS FOR MARKETING HIRES, COSTING COMPANIES ROUGHLY $273,937 PER OPEN SALES POSITION, AND $193,750 PER OPEN MARKETING POSITION. First year sales rep positions fill the fastest and take just over 3 months, a month faster than our last report. Top sales rep, national accounts and sales director positions take longer at close to 5 months. Product management and marketing management positions take 4 months, and marketing director positions take 5 months. Marketing positions take on average 5 months to fill and are consistent with last yearâ&#x20AC;&#x2122;s data.

CLICK HERE FOR FULL SURVEY RESULTS

31 | HS&M MAY/JUNE 2019

AVERAGE TIME TO FILL A SALES POSITION

AVERAGE TIME TO FILL A MARKETING POSITION

$ COMMENT

Jacobs Management Group, Inc., a leading healthcare industry search firm, undertook this 2019 Compensation Survey specifically for the medical device, pharmaceutical, biotechnology, and healthcare vendor sectors to provide our clients with specific quantifiable compensation data. This article presents

the highlights of that survey. Please click below to get the full survey report, or email Cari Kraft for further details, or to provide input for what you would like to see in the 2019 Survey. We would appreciate knowing if this has been helpful to you.

HS&M MAY/JUNE 2019 | 32

INDUSTRY

Deloitte 2019 Global Life Sciences Outlook Deloitte is one of the premier consulting companies in the world. It has more than 286,200 professionals globally, and is the 4th largest privately owned company in the United States. Deloitte has been ranked number one by market share in consulting by Gartner, and for the fourth consecutive year, Kennedy Consulting Research and Advisory ranks Deloitte number one in both global consulting and management consulting based on aggregate revenue. So it makes sense to be alert to their wisdom about our industry. Hereâ&#x20AC;&#x2122;s a brief summary of their recent Global Life Sciences Outlook for the year. To access the whole report, go here.

Partnerships, patients and data Strategic transformation is at the core of life science companies as they build new business models for the future. To accelerate change, focus will be on developing innovative and relationship-driven partnerships and creating real value for patients. Data is now the currency of life sciences, and mobilizing data throughout the enterprise, transforming work, and using technology symbiotically will be fundamental to advancing digital transformation. In 2019, the life sciences sector will see a strategic rise of the digital mindset and further adoption of transformative technologies. While traditional investment vehicles, like mergers & acquisitions, can expect a sharper focus, external innovation can become a meaningful culture change-agent through innovative and creative partnerships with new entrants and nontraditional players.

33 | HS&M MAY/JUNE 2019

Chart 1

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INDUSTRY The digital age requires more transparency and disclosure and a need for real relationship-driven partnerships will extend to all sector stakeholders—patients, advocacy groups, and regulators —and also to outsourcing vendors critical to the supply chain. Data will be the force behind new revenue models and crucial to understanding and delivering an exceptional patient experience.

businesses as they look to accelerate change and elevate the patient experience. The outlook provides suggestions for stakeholders to deal with the changing global economy and discusses examples from the market. The report also provides leaders with key questions and actions to consider in the year ahead. See Chart 1.

Global life sciences sector issues in 2019

Continued pricing pressures, increasing access to drugs, growth of gene and cell therapies, and uncertain trade policies will further change the dynamics of the market. The 2019 Global Life Sciences Outlook gives insights into the global life sciences economy and reviews the trends impacting

STRATEGIC FOCUS ON DEALMAKING AND EXTERNAL INNOVATION In 2019, biopharma faces a compelling strategic imperative for external innovation. The simultaneous hunt for next gen medicines

Chart 2 Strategic focus on deal-making and external innovation

External innovation is likely to continue to be a strategic focus for pharma companies that may face patent expiries, competition from generics and biosimilars, weak new drug pipelines, and growing technology needs

against declining R&D returns make external deals a key innovation source for companies. It is likely to be the dawn of a new age of deal-making, especially, for companies looking to take the lead in next-generation therapies. Large, transformative acquisitions in the US$60-70 billion range defined 2018 and the beginning of 2019. This year, we will see an increase in appetite for mid-sized strategic transactions that complement a company’s core and shedding of non-core assets. See Chart 2. KEY TAKEAWAY: Companies need to aim to strengthen their R&D pipeline through mergers and acquisitions, licensing, and strategic partnerships. However, this year, the transactions are likely to be more complex with innovative structuring, as opposed to the conventional framework. While companies may be rearranging portfolios based on pricing controls, acquisitions are expected to be very strategic with a focus on core therapies or specialties. As a result, a lot of activity is also expected in divestitures.

Focus on new entrants Licensing

93%

Leads deal-making, constituting 93 percent of deals

M&A Even with a mega-deal to start 2019, companies are expected to go back to their core, possibly shedding non-core assets, and likely doubling down on therapeutic focus.

Joint ventures Expect pooling of resources, joint ventures and partnerships to divest, monetize, or gain value

35 | HS&M MAY/JUNE 2019 www.deloitte.com/lifesciencesoutlook

As digitization continues to shape the corners of pharma, a new generation of startups and tech giants have emerged, disrupting the status quo and threatening pharma’s legacy culture. While pharma giants are investing in gene-based therapeutic solutions, more than 250 startups are already developing these therapies and building them around the patient. These startups could merge and form a whole new breed of company with a very different culture around innovation and life sciences. In 2019,

Chart 3 Focus on new entrants

Next generation or technology startups and large tech companies continue to threaten the status quo. More than 250 startups are focused on gene-based therapeutic solutions. Six of the top ten tech giants are diversifying into health care and life sciences. They are developing both diagnostics and therapeutics, and using their deep understanding of the consumer to enhance and simplify the patient experience.

Also witnessing regulatory disruption as a result of tech companies

Next gen therapies Adoptive cell transfer

Monoclonal antibody

Immunotherapies

Gene therapy

Cancer vaccines

Lack of manufacturing capacity is expected to continue to present a signiﬁcant challenge for next-generation therapies

a lack of manufacturing capacity for next generation therapies still poses a challenge.

www.deloitte.com/lifesciencesoutlook KEY TAKEAWAY:

While new entrants provide an opportunity for companies to drive innovation, they also pose an undeniable threat. Unable to cope with the new age capacities and diversities, the old school pharma may find itself outside the value chain. In the digital economy, smaller companies, often with one asset, are increasingly trying to control that asset throughout its life cycle. Even with limited infrastructure, they could compete with pharma giants in their domains.

About Deloitte Deloitte refers to one or more of Deloitte Touche Tohmatsu Limited, a UK private company limited by guarantee (“DTTL”), its network of member firms, and their related entities. DTTL and each of its member firms are legally separate and independent entities. DTTL (also referred to as “Deloitte Global”) does not provide services to clients. Please see www.deloitte.com/about for a more detailed description of DTTL and its member firms. Deloitte provides audit, consulting, financial advisory, risk management, tax and related services to public and private clients spanning multiple industries. With a globally connected network of member firms in more than 150 countries and territories, Deloitte brings world-class capabilities and high-quality service to clients, delivering the insights they need to address their most complex business challenges. Deloitte’s more than 200,000 professionals are committed to becoming the standard of excellence.

Tech giants diversifying into health care and investing in startups are masters of data. They know how to simplify the patient experience and are developing medical grade technology for both diagnostics and therapeutics. In 2018, the first tech giant received an FDA clearance demonstrating that regulatory is also poised for disruption from these new entrants. According to a recent survey, more than 80 percent of medtech R&D leaders plan to partner with organizations outside of medtech — like technology and health care companies. See Chart 3.

About Life Sciences and Health Care at Deloitte Touche Tohmatsu Limited The Deloitte Touche Tohmatsu Limited’s life sciences and health care (LSHC) industry group is composed of more than 12,000 professionals in more than 90 countries. These member ﬁrm professionals understand the complexity of today’s life sciences and health care industry challenges, and provide clients with integrated, comprehensive services that meet their respective needs. In today’s environment, LSHC professionals from across the Deloitte network help companies to evolve in a changing marketplace, pursue new and innovative solutions, and sustain long-term proﬁtability. For more information about the DTTL LSHC industry group, email dttlshc@deloitte.com or access www.deloitte.com/lifesciencesoutlook. ©2019. For more information, contact Deloitte Touche Tohmatsu Limited.

Focus on expanding a richly networked ecosystem Digitization, no doubt, is helping establish a richly networked and collaborative ecosystem. While

such a system provides an excellent scope for value creation, it also poses risks from unmonitored third-party activities. Data partners, the Internet of Things (IoT), and the growing Internet of Medical Things (IoMT) have constantly been warning about the surfacing cyber risks in pharma. Therefore, leaders are expected to develop management frameworks and partner with those having compatible risk profiles. Digitization of health care processes has also given way to mounting patient expectations. This essentially means that life sciences leaders should try to gain a deeper understanding of patient experiences and expectations when designing value chains. See Chart 4. KEY TAKEAWAY: While digitization brings in ample opportunities, it also exposes pharma companies to vulnerabilities like cyber threats, especially in a scenario where interdependency and collaboration are scaling. With digitization of tools and processes, patient expectations too have risen. Stakeholders should create coherent and meaningful experiences through the entire chain of patient interactions across all phases—from R&D and product launch to commercialization.

Focus on outsourcing Pharmaceutical giants are moving to adopt strategic and relationship-based outsourcing models as opposed to the traditional transactional engagements. This will likely stimulate biologics and data-driven clinical innovation, and bolster manufacturing capacity. The upcoming year could see more outsourcing of expertise, HS&M MAY/JUNE 2019 | 36

INDUSTRY Chart 4 Focus on expanding a richly networked ecosystem

Digital technologies and massive connectivity are creating rich networks of connection, collaboration, and interdependence Rich networked ecosystems could create new value, provide a competitive advantage, and accelerate learning The need for companies to translate learning into innovation has never been greater

Managing third-party risk Adapting to an increasingly complex environment Broader-based and extended enterprise risk Lack the necessary visibility and monitoring of third-party activities and platforms Life sciences companies are ultimately responsible Manage ‘cyber everywhere’

Keep patients at the core! Chart 5

www.deloitte.com/lifesciencesoutlook

Focus on outsourcing

A shift from transactional outsourcing relationships to more strategic, relationship-based models for biologics, data-driven clinical innovation, and manufacturing capacity.

Outsourcing expertise in AI, robotic, and cognitive automation, and cloud computing.

For more information about the DTTL LSHC industry group, email dttlshc@deloitte.com or access www.deloitte.com/lifesciencesoutlook. ©2019. For more information, contact Deloitte Touche Tohmatsu Limited.

Data-driven clinical innovation Inﬂuenced by patients’ experiences with vendors and CROs

Biologics Increasingly partnering with academia & CROs for R&D capabilities

Vendors that provide platforms to eﬀectively integrate data from multiple systems into a central decision-making tool should be in demand

Manufacturing capacity Only 1/3 of manufacturing—whether in the development stages or after commercial launch—is estimated to be conducted in-house

New vendor relationship Need a game plan / predetermined objectives for how new vendors can meet requirements

Need to building more strategic, long-term partnerships with CMOs and CDMOs to streamline the supply chain

37 | HS&M MAY/JUNE 2019

especially cognitive automation, AI, and cloud computing. Sector growth driven by biopharmaceutical outsourcing is also a possibility. Strategic partnerships with academia and contract research organizations (CROs) indicate that companies are focusing on strengthening R&D capabilities. See Chart 5. KEY TAKEAWAY: Strategic, long-term partnerships are a requisite for pharma companies to streamline supply chain, better manage the capacity gap arising from the shift to biologics and personalized medicine, and thereby improve time-to-market. Sustaining close relationships with vendors is critical for maintaining compliant operations, because an oversight may cost pharma companies their reputation. Knowledge management is moving to the next level in the pharma space with advanced technologies like AI, machine learning, and IoT.

Collaborating with new partners for transformation Digitization of health care has transformed the way patients, providers, and innovators interact. A highly patient-centric future is already surfacing and organized patient advocacy groups are playing an increasingly important role. In 2019, collaborative approaches will be key for working with patients and regulators, advancing drug development and the Internet of Medical Things. Large and small companies will also need to work together to minimize cyber risks in the ecosystem. See Chart 6. KEY TAKEAWAY: In this highly digitized and connected world where patients have

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complete visibility into the experience they will be provided, it is imperative for companies to double the focus on customer experience. Companies should prioritize interpreting the burden of a disease on specific groups by building a culture where patients are partners, and not just consumers. Advanced technologies like AI can play a critical role here by helping pharma companies produce highly personalized solutions at competitive prices within shorter durations. Integrating connected medical devices into existing care pathways require collaboration across the IoMT ecosystem that

can be facilitated by partnerships and joint ventures.

planning, patient monitoring, and drug discovery.

Transformative technologies in life sciences

Internet-of-Medical-Things (IoMT): The rising number of connected medical devices—together with advances in the systems and software that support medical grade data and connectivity—have created the IoMT. Connecting devices is currently a priority as sensors are transforming diagnosis and the way patients are treated and monitored.

The physical, digital, and biological worlds converge in Industry 4.0. Forward-thinking pharma companies are moving beyond pilots and focusing on how new technologies can add value. These are some of the technologies driving digital transformation in life sciences. Artificial Intelligence (AI): AI is just beginning to be applied in life sciences to help with intelligent use of data. It has the potential to revolutionize diagnoses, treatment

Chart 6 Collaborating with new partners for transformation

Patients Becoming partners in the design of their health care experience Developing a true partnership with patients—leveraging patient data and understanding the burden of disease, the caregiver’s role, access decisions, and the health care systems involved Increased importance - Patient advocacy groups, national disease organizations, venture philanthropy

Regulators Companies are viewing regulatory functions as a strategic asset and are developing the skills to eﬀectively collaborate with regulators.

Regulators beneﬁting from more collaborative approaches, such as co-regulation, self-regulation, and international coordination.

A collaborative approach to drug development

Impact of master protocols

Master protocols

Impact of cycle time savings

Medical Aﬀairs collaborating with R&D

Traditional patient enrollment and site-startup time:

Medtech partnerships in the IoMT Move from innovative product suppliers to insightful partners in health care

Impact of cost savings Traditional cost:

117 weeks

$11.2M

Master protocol patient enrollment and site-startup time:

96–102 weeks

Master protocol cost: $$$

$9.5–$9.8M

Blockchain: Blockchain has emerged as a potent solution to aggregate data with ease and share it securely in an automated and error-free way. DIY diagnostics and virtual care: Tools that provide at-home convenience can also help with faster diagnoses and provide 24/7 access to health coaching and monitoring. DIY diagnostic tests can help low-income or rural consumers determine if a condition warrants a visit to a doctor or hospital. Future of mobility: The emergence of connected, electric, and autonomous vehicles will bring another transformation in the pharma world by expanding mobility and thereby, access to care and democratization of clinical trials. See Chart 7. KEY TAKEAWAY:

Collaboration between providers, manufacturers, and suppliers is seen as key to bridging gaps in medical device cybersecurity

Software-as-a-Medical-Device (SaMD): Software is changing how clinicians practice medicine, how consumers manage their own health, and how patients and providers interact. SaMD is a software that provides one or more medical functions and is usually embedded in hardware. The algorithms powering SaMD are already proving better than some clinicians’ diagnoses.

Savings: 13%–18% (15–21 weeks)

Savings: 1.3%–1.6% (12–15% weeks)

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Disruptive technologies have HS&M MAY/JUNE 2019 | 38

INDUSTRY Chart 7

Transformative technologies in life sciences

Artiﬁcial intelligence (AI)

Blockchain

The potential to revolutionize diagnoses, treatment planning, patient monitoring, and drug discovery

Potential solution to more easily aggregate and share health data in a secure, trusted, automated, and error-free way

Internet-ofmedical-things (IoMT) Valued at US$41.2 billion in 2017, the IoMT market is expected to rise to US$158.1 billion in 2022

DIY diagnostics and virtual care Consumers are increasingly open to new channels of care—particularly at-home diagnostic testing Could help low-income or rural consumers determine if a condition

Software-as-aMedical-Device (SaMD) Allows patients to play a more active role

warrants a visit to a doctor or hospital

Future of mobility

in their own health care

Shifting attitudess toward mobility

SaMD has, at times, outperformed the

and changing the way people and

accuracy of diagnoses by trained clinicians

goods move

Regulation of SaMD is expected to need

Could improve access to care

to become more agile

Real-World Evidence (RWE) and platforms and emerging techcertainly transformed health care www.deloitte.com/lifesciencesoutlook focusing on end-to-end, AI-drivnologies are measuring value and and life sciences. But organizaen, internally-developed solutions. outcomes with greater efficacy. Big tions would need to look at how About Deloitte Deloitte refers to one technologies or more of Deloitte Touchecan Tohmatsu Limited, a UK private company limited insights by guarantee (“DTTL”), of member firms, and their related entities. See Chart 8.DTTL and each of its member firms are Data driven canits network dramatithe disruptive legally separate and independent entities. DTTL (also referred to as “Deloitte Global”) does not provide services to clients. Please see www.deloitte.com/about for a more detailed description of DTTL and its member firms. audit, consulting, financial meaningadvisory, risk management, tax and related services to public and private clientscare spanningand multiple industries. With a globally connected network of member firms in more than cally transform patient workDeloitte in provides tandem to drive 150 countries and territories, KEY TAKEAWAY: Deloitte brings world-class capabilities high-quality service to clients, enhance delivering the insights they need to address their complex business challenges. Deloitte’s more than 200,000 professionals are committed productivity ofmost trials. ful transformation andandprovide to becoming the standard of excellence. value. Many companies are still In 2019, the early adopters of R&D seems to have embarked on a Disclaimer This publication contains general information only, and none of Deloitte Touche Tohmatsu Limited, its member firms, or their related entities (collectively the “Deloitte Network”) is, by means of this publication, rendering in the experimental stage when it digital technologies and platforms journey digital wave professional advice or services. Before making any decision or taking any new action that may affect your with finances orthe your business, you should consult a qualified professional adviser. No entity in the Deloitte Network shall be responsible for any loss To whatsoever sustainedtheir by any person who relies on this publication. comes to digital. realize could benefit from better engagewhere trials are less burdensome About Life Sciences and Health Carepace at Deloitte Touche Tohmatsu Limited full potential and keep with with patients, deeper insights and more engaging. Patients are in more than 90ment The Deloitte Touche Tohmatsu Limited’s life sciences and health care (LSHC) industry group is composed of more than 12,000 professionals countries. These member firm professionals understand the complexity of today’s life sciences and health care industry challenges, and provide clients with integrated, comprehensive services that meet their respectivefrom needs. In today’s environment, LSHC professionals from acrosscycle technology’s rapid evolution, reguclinical trials, and faster clinical the Deloitte network help companies to evolve in a changing marketplace,collaborators pursue new and innovative during solutions, and sustain long-termtrials profitability. lation of these technologies needs times for products in development. and notor just passive participants. For more information about the DTTL LSHC industry group, email dttlshc@deloitte.com access www.deloitte.com/lifesciencesoutlook. ©2019. For more information, contact Deloitte Touche Tohmatsu Limited. to become more agile. The emergence of virtual cliniCreating value with new cal trials has eliminated the need Mobilizing data, the business and operating for travel, thereby, expanding the currency of life sciences geographical reach and accessibilmodels ity from a patient-care point of innovation Digitally maturing biopharma view. R&D executives are placing Forward-looking life sciences companies are exploring ways of greater emphasis on the role of leaders who have adopted digital applying an enterprise-wide ap39 | HS&M MAY/JUNE 2019

Chart 8 Mobilizing data, the currency of life sciences innovation Transforming clinical development with digital R&D—can support making trial participation less burdensome and more engaging by redeﬁning how patient care is delivered during clinical trials Treating trial participants as collaborators instead of subjects Novel clinical trial designs: Virtual trials—As many as half of all trials may be done virtually in the not so distant future, netting signiﬁcant cost savings New regulatory guidance meant to expedite adaptive clinical trials and allow researchers to evaluate multiple aspects of a drug in development in a single trial

Adoption of big data analytics

ROI of real-world evidence (RWE)

and digital platforms should

Greater emphasis and focusing on end-to-end, AI-driven, internally-developed solutions.

be help better measure value and outcomes

Likely to be shaped by an increase in strategic data partnerships and new ways of procuring data

Includes health records, wearable device data, and/or social media accounts Digital technology expediting recruitment and diversifying participants

Digital technologies/platforms =

Better access/engagement + Deeper insights + Faster cycle times

www.deloitte.com/lifesciencesoutlook

Chart 9

Creating value with new business and operating models

Disclaimer This publication contains general information only, and none of Deloitte Touche Tohmatsu Limited, its member firms, or their related entities (collectively the “Deloitte Network”) is, by means of this publication, rendering professional advice or services. Before making any decision or taking any action that may affect your finances or your business, you should consult a qualified professional adviser. No entity in the Deloitte Network shall be responsible for any loss whatsoever sustained by any person who relies on this publication. About Life Sciences and Health Care at Deloitte Touche Tohmatsu Limited The Deloitte Touche Tohmatsu Limited’s life sciences and health care (LSHC) industry group is composed of more than 12,000 professionals in more than 90 countries. These member firm professionals understand the complexity of today’s life sciences and health care industry challenges, and provide clients with integrated, comprehensive services that meet their respective needs. In today’s environment, LSHC professionals from across the Deloitte network help companies to evolve in a changing marketplace, pursue new and innovative solutions, and sustain long-term profitability. For more information about the DTTL LSHC industry group, email dttlshc@deloitte.com or access www.deloitte.com/lifesciencesoutlook. ©2019. For more information, contact Deloitte Touche Tohmatsu Limited.

Learning how to scale, enterprise-wide solutions, creating value in novel ways—companies are exploring new ways of doing business and applying an enterprise-wide approach to digital transformation Adopting a consumer-driven model—a “B2C thinking” is transforming the patient experience Digital tools for engaging patients—a third of consumers are interested in using apps for health care engagement Finding new revenue models—Transforming from a product sector to services sector What is their role in the patient-journey and the value they provide? Patients want care and solutions that are simpliﬁed, coordinated, customized, and accessible New entrants are demonstrating that health consumers are willing to pay for convenience Focus on wellness—move from ‘sick’ care to ‘health’ care Data as being seen as a possible revenue generator, particularly in Medtech

www.deloitte.com/lifesciencesoutlook

proach to digital transformation. All of these approaches require patient centricity. B2C thinking: Organizations aligning with how consumers respond to or use products or services—like digital health apps, telemedicine, wearable monitoring devices, etc. can design top-notch engagement strategies. Engagement tools: Patients who are informed about their condition and involved in their treatment decisions tend to have better health outcomes and typically incur lower costs. Focus on prevention and digital therapeutics: Digital therapeutics can be a new source of revenue for life sciences, potentially providing reimbursement through insurance plans in the same way as drugs or medical technologies. Opportunities to monetize data: The challenge for life sciences companies is building trust. 40 percent are willing to share their data for health care research or to improve a device. Fewer are willing to share information with device manufacturers. See Chart 9. KEY TAKEAWAY: Life sciences leaders are also looking to leverage advanced digital technologies to identify new revenue sources. The sector will likely need to harness the shift from product to service. Companies should have a vision for their role in the patient journey and the overall health care system.

Advancing digital transformation in life sciences More than three-quarters of biopharma companies agree that their organizations need new leaders to HS&M MAY/JUNE 2019 | 40

INDUSTRY Chart 10

Advancing digital transformation in life sciences

More than 3/4 of biopharma companies agree that their organizations need new leaders to succeed in the digital age.

Many companies are recruiting outside of life sciences for digital expertise.

Currently, only 20 percent of companies feel they have matured in their journey to becoming a digital enterprise.

Life sciences companies should start with determining and articulating their ambition—prioritizing initiatives, anchoring decisions, and focusing on the future.

succeed in the digital age. Many A greater percentage of digitallylytics and machine learning. The www.deloitte.com/lifesciencesoutlook companies are recruiting outmaturing biopharma companies increased use of advanced technolside of the life sciences sector for are exploiting new ways of doing ogies does not mean human effort About Deloitte Deloitte refers to one or more of Deloitte Touche Tohmatsu Limited, a UK private company limited by guarantee (“DTTL”), its network of member firms, and their related entities. DTTL and each of its member firms are digital expertise. Currently, only business as opposed to exploiting will be replaced, rather, it will be legally separate and independent entities. DTTL (also referred to as “Deloitte Global”) does not provide services to clients. Please see www.deloitte.com/about for a more detailed description of DTTL and its member firms. Deloitte provides audit, consulting, financial advisory, risk management, tax and related services to public and private clients spanning multiple industries. With a globally connected network of member firms in more than 20 percent of companies feel they organizational competencies. Colleveraged for high level tasks so 150 countries and territories, brings world-class capabilities and high-quality service to clients, delivering the insights they need to address their most complex business challenges. Deloitte’s more than 200,000 professionals are committed have Deloitte matured in their journey to laboration is seen as a key differthat efficiencies can be optimized to becoming the standard of excellence. becoming a digital enterprise. See entiator. Leaders should not only and adversaries are eliminated. See Disclaimer publication contains general information only, and none of Deloitte Touche Tohmatsu Limited, its member firms, or theirinternally related entities (collectively the “Deloitte Network”) ChartThis 10. encourage collaboration Chart 11. is, by means of this publication, rendering professional advice or services. Before making any decision or taking any action that may affect your finances or your business, you should consult a qualified professional adviser. No entity in the Deloitte Network shall be responsible for any loss whatsoever sustained by any person who relies on this publication. across functions, but also exterKEYAbout TAKEAWAY: KEY TAKEAWAY: Life Sciences and Health Care at Deloitte Touche Tohmatsunally. Limited They also need to provide a The Deloitte Touche Tohmatsu Limited’s life sciences and health care (LSHC) industry group is composed of more than 12,000 professionals in more than 90 countries. These member firm professionals understand the complexity of today’s life sciences and health care industry challenges, and provide clients with integrated, services meet their respective needs. In today’s environment, LSHC professionals from across clear vision andcomprehensive purpose forthattheir To advance digital transformation To maximize the potential value of the Deloitte network help companies to evolve in a changing marketplace, pursue new and innovative solutions, and sustain long-term profitability. organization’s digital investments in 2019, life sciences companies advanced technologies today and For more information about the DTTL LSHC industry group, email dttlshc@deloitte.com or access www.deloitte.com/lifesciencesoutlook. ©2019. For more information, contact Deloitte Touche Tohmatsu Limited. and empower people to think difshould start with determining minimize the potential adverse imferently. and articulating their ambition. pacts on the workforce tomorrow, This means prioritizing initiatives, organizations should put humans The future of work requires a fresh anchoring decisions, and focusing in the loop—reconstructing work, perspective and the sector is beon the future. Leaders can then be retraining people, and rearranging ginning to embrace new recruits, poised for adapting new operatthe organization. Companies can like chief digital officers (CDOs), ing models, transforming work create incubator spaces in innocoming from outside the life sciculture, implementing technology, vation clusters around the globe, ences sector. In addition to having and scaling solutions. specifically designed to support a digital-first attitude, outsiders early-stage companies that need will increasingly be sources of Transforming work facilities, mentoring, and networkexpertise for advanced data anaing to progress. • 41 | HS&M MAY/JUNE 2019

Chart 11

Transforming work

Organizations displaying higher digital engagement and data analytics skills appear to have leaders that embrace change and employees who are willing to get on board with new initiatives. A greater percentage of digitally-maturing biopharma companies are exploiting new ways of doing business as opposed to exploiting organizational competencies.

Collaboration is seen as a key diﬀerentiator.

Well-being is emerging as a strategic priority.

CDOs are being recruited from other industries with the expectation that they could provide fresh perspectives.

Life sciences is competing with other industries for scarce, tech-savvy talent.

Increasing use of tech—AI, robotic, cognitive—not replacing workers but shifting the focus onto high-level tasks.

www.deloitte.com/lifesciencesoutlook About Deloitte Deloitte refers to one or more of Deloitte Touche Tohmatsu Limited, a UK private company limited by guarantee (“DTTL”), its network of member firms, and their related entities. DTTL and each of its member firms are legally separate and independent entities. DTTL (also referred to as “Deloitte Global”) does not provide services to clients. Please see www.deloitte.com/about for a more detailed description of DTTL and its member firms. Deloitte provides audit, consulting, financial advisory, risk management, tax and related services to public and private clients spanning multiple industries. With a globally connected network of member firms in more than 150 countries and territories, Deloitte brings world-class capabilities and high-quality service to clients, delivering the insights they need to address their most complex business challenges. Deloitte’s more than 200,000 professionals are committed to becoming the standard of excellence. Disclaimer This publication contains general information only, and none of Deloitte Touche Tohmatsu Limited, its member firms, or their related entities (collectively the “Deloitte Network”) is, by means of this publication, rendering professional advice or services. Before making any decision or taking any action that may affect your finances or your business, you should consult a qualified professional adviser. No entity in the Deloitte Network shall be responsible for any loss whatsoever sustained by any person who relies on this publication. About Life Sciences and Health Care at Deloitte Touche Tohmatsu Limited The Deloitte Touche Tohmatsu Limited’s life sciences and health care (LSHC) industry group is composed of more than 12,000 professionals in more than 90 countries. These member firm professionals understand the complexity of today’s life sciences and health care industry challenges, and provide clients with integrated, comprehensive services that meet their respective needs. In today’s environment, LSHC professionals from across the Deloitte network help companies to evolve in a changing marketplace, pursue new and innovative solutions, and sustain long-term profitability. For more information about the DTTL LSHC industry group, email dttlshc@deloitte.com or access www.deloitte.com/lifesciencesoutlook. ©2019. For more information, contact Deloitte Touche Tohmatsu Limited.

COMMENT HS&M MAY/JUNE 2019 | 42

INNOVATIONS

The eyeforpharma 2019 North American winners: Novartis, Takeda and others show the way At Aprilâ&#x20AC;&#x2122;s eyeforpharma Philadelphia event, four major awards were given to North American companies, organizations and individuals in recognition of their innovation in various areas of healthcare: patient initiative, HCP or healthcare initiative, collaboration, and patient champion. These join the European winners (NuvoAir, Aptus Health/ Boehringer Ingelheim, Novartis and Teresa Ferreiro, respectively) in being honored for advancing care for patients and the industry as a whole. Here are the North American awards.

MOST VALUABLE COLLABORATION Winner: Novartis Pharmaceuticals Corporation and Johns Hopkins Medicine Initiative: Ensemble-Managing Cancer at Work

43 | HS&M MAY/JUNE 2019

THE STORY: “You have cancer.” Those three words can change life in an instant. Questions about the diagnosis, treatment options and managing work become top of mind. That is why Novartis collaborated with Johns Hopkins Medicine to create Ensemble: Managing Cancer at Work. Ensemble is a supportive community originally developed by Novartis to help associates and their loved ones or colleagues whose lives are touched by cancer. Knowing that the cancer journey can be so complex, the program was designed with simplicity in mind and provides expert support from a renowned research and clinical center. Ensemble provides helpful resources and quality health, emotional and physical support with information on how to prevent cancer, recognize its early warning signs, and manage treatment to optimize health and well-being. Nurse Navigators listen with compassion and complete confidentiality, providing guidance on medical resources and work issues, with the ability to direct questions to other appropriate resources. Novartis recognized the opportunity to partner with Johns Hopkins Medicine – which had launched its own Managing Cancer at Work program with a similar focus – to create the combined EnsembleManaging Cancer at Work offering. Through this joint effort, Novartis has demonstrated its ongoing commitment to the health and wellness of its associates. Nearly two-thirds of cancer survivors return to work after their diagnosis and experience unique challenges as they strive to maintain health and career goals. About 40 percent of the 14.5 million cancer survivors in the U.S. are of working age. Many survivors need to keep their jobs through treatment and recovery to maintain income

or because their health insurance is provided through their employer. Going to work can help maintain a sense of purpose, in addition to offering a support network and a welcome distraction serious illness. At the same time, employers report a level of complexity in managing employees’ cancer-related needs beyond that associated with any other type of disease or condition. Gaps exist to adequately address the needs and cultivate optimal outcomes for these employees and their organizations. Novartis sought to identify innovative solutions that could have a positive social impact among its own employees impacted by a cancer diagnosis. In 2014, Novartis created an internal network of medical volunteers, as well as provided dedicated nurse services, through an initiative called Ensemble. The goal was to provide thoughtful support, guidance, information and educational resources to address the concerns of employees with cancer, their caregivers and managers. As Ensemble evolved, Novartis reached out to an expert in healthcare for a potential partnership to expand upon the successful initiative. Johns Hopkins Medicine had developed a similar program called Managing Cancer at Work to help their employees diagnosed with cancer. In 2016, Johns Hopkins decided to make Managing Cancer at Work available to other organizations. The Johns Hopkins initiative had three key elements – an extensive web-based educational tool covering cancer prevention and early diagnosis, education and support for any employee diagnosed with cancer or caring for a loved one with cancer, and detailed education for managers and supervisors who might have a cancer patient, cancer survivor or caregiver on their work team. In addition, a major component of the Hopkins

effort is the Oncology Nurse Navigators, who provide personalized guidance to employees and managers on topics including understanding and managing a cancer diagnosis; balancing health with work and family responsibilities; awareness of cancer’s financial impact; caregiving; and survivorship. When Novartis learned of the Hopkins’ initiative, they reached out to explore how to combine the two programs. The result: the launch of Ensemble-Managing Cancer at Work in 2017. Johns Hopkins’ Managing Cancer at Work program includes a comprehensive informational website with content created/reviewed by Johns Hopkins experts, while the Nurse Navigator feature allows for individualized support for Novartis employees, providing help with work-related, healthcare-related, and emotional aspects of dealing with a cancer diagnosis and treatment. Novartis implemented Ensemble as an extension of its mission to improve patient’s lives. Because of the success of Ensemble – and the increased awareness achieved with the Hopkins’ collaboration – the program is growing globally. Project leaders say that “By joining forces with external innovators to pursue shared interests, we can increase the breadth/depth of the impact we deliver. Through active engagement, we can create a collaborative environment to maximize the probability of success.” It is a privilege to be recognized by eyeforphama as a leader in finding valuable solutions for patients. Novartis and Johns Hopkins Medicine wish to share our collaboration with pharma executives, patient advocacy groups, and other health experts to share our idea broadly and facilitate positive change.

HS&M MAY/JUNE 2019 | 44

INNOVATIONS MOST VALUABLE HCP OR HEALTHCARE INITIATIVE Winner: Medscape Education and Takeda Pharmaceuticals Initiative: Clinical Advances in Major Depressive Disorder: Focus on Patient-Centered Care

THE STORY: Nearly one in five adults in the U.S. suffers with major depressive disorder. Although a common, pervasive and serious disease, affecting an estimated 16.1% of adults in the US, it remains underdiagnosed and undertreated – with significant quality of life and mental health consequences and an increased risk of morbidity and mortality from other serious conditions.

gram was supported by an educational grant from Takeda Pharmaceuticals.

To help close existing professional gaps in treating MDD, Medscape Education developed 20 Continuing Medical Education/Continuing Education (CME/CE)-certified educational activities and hosted them on a learning destination page dedicated to MDD. The pro-

Takeda Pharmaceuticals wanted to bring greater awareness to management of depression which was desperately needed. It was important for Takeda to demystify and de-stigmatize depression and they realized that this would require a greater effort than ever conducted before.

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For the past five years, Medscape Education and Takeda Pharmaceuticals have worked to close professional gaps with the hope of improving management by developing an educational learning destination for healthcare providers to become better equipped to manage and help patients with MDD.

The destination page was designed to educate primary care physicians (PCPs), psychiatrists, nurse practitioners (NPs), Physician Assistants (PAs) and nurses so that they may: • Optimize the use of screening tools to capture all patients who may have MDD, residual symptoms, and recurrent or moderate to severe MDD • Improve their confidence in recommending the most appropriate treatments based on patient characteristics and preferences • Stay up to date on the latest data to translate advances into patient care • Improve communication with patients, including administration

of nonpharmacologic interventions that are linked to improved patient outcomes and providing guidance on appropriate treatment expectations Medscape Education reached out to its registered healthcare member audience to deliver this education to the largest online membership of active US clinicians, including 202,789 PCPs, 91,229 primary care NPs/PAs, 39,352 psychiatrists, 7845 psychiatry NPs/PAs, and 903,600 nurses. The education initiative reached and impacted over 166,000 healthcare providers in the United States and made notable improvements in the management of MDD. The most notable impacts included: • 31% of PCPs and 29% of psychia-

trists reported improved confidence in their ability to manage patients with MDD. Participation also led to improved knowledge among 25% of PCPs on concepts related to adjusting treatments.[Thase 2016] • On post-assessment, 34% more PCPs (593% relative change; from 10 to 109 scripts) and 33% more psychiatrists (179% relative change; from 47 to 171 scripts) selected appropriate therapies for a patient with cognitive deficits (case 1).[Jain 2016] • PCPs and psychiatrists dramatically improved their compliance with quality standards, as well as their ability to apply these standards in the real-world management of patients with MDD, with a median improvement of 48% on

post-assessment for both target audiences, particularly on switching medications and optimizing treatments (i.e. adding sleep aids). [Gaynes 2016] This was a multi-tier partnership effort led by Medscape Education, in partnership with PatientsLikeMe, and including content on WebMD Education (WebMD is the parent company of Medscape). Each entity filled a key niche and educational need in depression - Medscape for clinicians, WebMD for patients, and PatientsLikeMe for their ability to share real-world data/treatment experiences. Together, this formed a very strong and strategic partnership.

MOST VALUABLE PATIENT INITIATIVE OR SERVICE Winner: Upside Health Initiative: Ouchie

valuable and targeted content (including meditations). The platform then rewards patients for recording their daily accomplishments, following their treatment plans and helping others.

THE STORY: There is enormous pressure on chronic pain patients to manage complex care plans, a reduction in access to medications and treatments that are often time consuming and under-covered by insurance. The pain itself can make patients incredibly isolated and frustrated. It’s an issue that touches more than 116 million Americans

a year. The Upside Health team designed, developed and launched Ouchie, a mobile companion for pain management – a free application for iOS, Android and tablet that helps support a chronic pain patient on their journey. The application allows for tracking/journaling, connection to others who live with similar pain, access to

Ouchie uses evidence-backed tools to ensure no chronic pain patient has to hurt alone. Tracking, CBT, contingency management, community and access to resources comes together on one platform to improve outcomes. Upside Health uses digital/mobile health technology, complex APIs and EHR integrations, along with artificial intelligence and natural language processing to understand what the user is experiencing and HS&M MAY/JUNE 2019 | 46

INNOVATIONS delivering relevant content. It also uses social functionality. The Upside Health team held focus groups with hundreds of patients, spoke with more than two dozen chronic pain specialists and then released a beta version of the application with 300 patients. During that time, the Upside Health team not only sent out surveys and spoke to users via e-mail and phone, but also actively made product modifications and used tracking analytics to get a visual understanding of platform usage and challenges. The #Just1Thing content on the application is all about just one thing a patient can do to find relief, while the data visualization and focus redirecting have both short and long term implications. The new clinical integration allows for better understanding of the patient experience and more precise treatment over longer periods of time. After less than one month on the

platform, 89% of the patients felt like they could effectively manage their pain, 83% were more likely to try or adopt a new treatment. They also reported declines in helplessness, hopelessness and frustration. Sample feedback from a user: “Great work you guys! And thank you for giving us all a place to learn about our pain, as well as getting to know others who are in the same boat!” The success of the application has led to additional excitement and interest from health systems and payers, as to how they can integrate this into their offerings. Shortly after launch, Ouchie became the official patient engagement app of the U.S. Pain Foundation. There are also partnerships with Weill Cornell’s Pain Center, NYU’s MS Center and the IASP World Congress on Pain. These partnerships introduced the platform to their members via social media, pamphlets and in-person

experiences. They were all managed via the Upside Health team. The data and insight gathered from patients is helping inform new functionality on the platform, including integration with wearables and connected devices, with an enhanced emphasis on accessibility. Ouchie is adding on new features like telehealth and partnerships that add further value to patients. The application, when clinically integrated, is delivering nuanced and personal information beyond the four walls of the health system that strengthen patient-provider relationships, allow for less friction and create opportunities for more targeted, precise care. Lastly, with partnerships in the pharmaceutical industry, the knowledge gathered by the Ouchie platform has the potential to not only improve efficacy of current treatments but also increase the pipeline for new ones. www.ouchie.com

THE PATIENT CHAMPION AWARD Winner: Molly MacDonald, Founder,CEO, The Pink Fund THE STORY: A breast cancer diagnosis can destroy the financial health and well-being of patients and their families. While in active treatment many patients are unable to work and experience a loss of income which can result in catastrophic financial losses. The Pink Fund provides financial support which meets basic needs, decreases

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stress levels and allows breast cancer survivors to focus on healing while improving survivorship outcomes. Cancer is one of the most costly diseases to treat. Patients and their families face high deductibles and co-pays, not to mention lost income as a result of some of the toxic side effects of treatment, making it impossible to work. Patients need strong financial navigation and support services to financially bridge this period of time. And while co-pay support is available to some, there is very little to help patients with nonmedical, non-negotiable bills, for housing, transportation, utilities and health insurance. Patients who experience a loss of income may not comply with the prescribed treatment plan, making potentially life-altering decisions if they cannot pay for their care. Molly MacDonald’s 2005 breast cancer diagnosis came at a time of job transition. Having been through a financially devastating divorce with five children, no alimony and sporadic child support, she had no savings to weather the storm. Without her income and the addition of a $1300 COBRA premium the family experienced what is now known as “financial toxicity.” Meeting other working women in treatment on unpaid leave, experiencing similar challenges and not able to find a single organization to help financially bridge unpaid time off during FMLA, she launched what became The Pink Fund. With very little money to launch, MacDonald traded a dining table for the organization’s heart &

ribbon logo. She took $50 and purchased a book called, “How To Form a Non-Profit Corporation.” The greatest challenge came in the first year of operation when two people she trusted to help sent her a courier-delivered letter severing their business relationship with her and taking the non-profit and its name as their own. Nevertheless, she prevailed. Despite the obvious obstacles she was enduring she became determined to make a difference, and did. She says, “I believed in myself and that belief propelled me forward despite numerous obstacles and challenges.” Within a month, MacDonald relaunched as The Pink Fund with a donated website and a front-page story written by now retired and award winning medical writer of The Detroit Free Press, Pat Anstett Kiska, on the front page of the women’s section. Other challenges were building a cohesive board of directors who understood the nature of nonprofit governance and their roles and limitations, and a committed and passionate staff. Since founding The Pink Fund in 2006, MacDonald has used her voice to advocate for women in treatment for breast cancer experiencing financial toxicity, sharing her story and theirs. She is a sought-after speaker on this subject, demonstrating the real problems and decisions patients make around treatment, when cost of care and lost income are factors. As a columnist for Breast Cancer Wellness Magazine, MacDonald writes on ways patients can mitigate the financial burdens of treatment. She sits on the board

of VBID, Value Based Insurance Design out of the University of Michigan, where insurance companies, pharma, providers, and consultants meet to discuss how to reduce the cost of health care to patients while providing high value outcomes. In 2018, she presented a case study on financial toxicity with respect to breast cancer and sat on a panel exploring potential solutions at the Patient Advocacy Engagement Conference in Baltimore. She led a roundtable discussion at the eyeforpharma I M Patient Conference in Philadelphia, and sat on a patient panel at the Association for Value Based Cancer Care Summit in New York City. She has been invited to join the speaking faculty in April 2019 at CBI’s Formulary, Copay and Access Conference. “At The Pink Fund we look at the number of women and families helped, about 273 annually; and the amount of bills paid on their behalf ($3 million as of November 2018),” says MacDonald. “The program dramatically reduces stress on the patient and their family, allowing them to focus on getting better. The tangible financial support The Pink Fund provides, removes one less worry as they undergo treatment. One cannot quantify or qualify hope, but ultimately hope is what The Pink Fund delivers. Finally, all one needs to do is read the thank-you notes we receive to understand the success of the program.” •

COMMENT HS&M MAY/JUNE 2019 | 48

INDUSTRY TRENDS: BY THE NUMBERS Compiled by Cari Kraft, Jacobs Management Group, Inc.

$472B

Outpatient revenue of U.S. hospitals Outpatient revenue for U.S. hospitals has continued to grow in the last several years. Total outpatient number for 2017 was $472B, compared to inpatient revenue of $498B, a ratio of 95% as compared to 83% in 2013. At the same time, hospital profits reached $88B, a 12.5% increase over 2016. Source: American Hospital Association 2019 AHA Hospital Statistics

302,767

45%

U.S. share of total global pharmaceutical market sales With just 4.4% of the worldâ&#x20AC;&#x2122;s population, the U.S. accounts for nearly half of total spending on pharmaceuticals. Europe accounts for about 20%, other developed markets 11%, and emerging markets 21%. These numbers have remained relatively steady for the last five years. Source: Statista 2019

Clinical trials being conducted worldwide As of April, 2019, there were over 300,000 clinical studies being conducted around the globe. Thirty-four percent of these (104,380) were in the U.S., with another five percent (16,043) happening simultaneously in the U.S. and other countries. Source: Clinicaltrials.gov, April 2019

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$1 00 ,0 00 ,0 00

$10B Digital ad spend in 2020 In a new study of digital advertising trends in healthcare, PulsePoint concluded that the total could reach $10 billion in 2020. The number would represent a 13% increase over current spending. The report also indicated that three out of four people were most likely to engage with health advertising when it offered additional information, and another two out of three would respond to â&#x20AC;&#x153;relevant informative content.â&#x20AC;? Source: The State of Programmatic Healthcare Marketing, PulsePoint, 2018

COMMENT

Drug developers who raised more than $100M in 2018 Venture capital firms invested more than $100,000,000 each in 37 healthcare companies in 2018, more than double the 16 companies in 2017 and 13 in 2016 who received similar amounts. Source: Vantage Evaluate Pharma, Biotech & Medtech 2018 in Review

46%

Physicians currently accessible to reps Since 2014, the number of physicians willing to meet with sales reps has leveled off at around 46%, down significantly from about 76% in 2008. Source: ZS AccessMonitor 2018

$1.0 Trillion Annual healthcare claims in U.S. A recent national survey of leading health plans and other healthcare stakeholders showed that the current total of healthcare claims in the U.S. has topped $1 trillion. The survey drew from information provided by 185 healthcare leaders, 28% of whom are at the president or C-suite level, 48% VP-level or above. Source: The HealthCare Executive Group and Change Healthcare

HS&M MAY/JUNE 2019 | 50

PHARMACEUTICAL

Great Advice From Great Minds: Greg Apostol talks with Jill Donahue, Author, Engage Rx I met Greg Apostol (VP, Alkermes) two days after his sister died from lung cancer. Encouraged by her last words to him, in which she expressed her pride in him and his purpose-driven career, he proceeded to fulfill his commitment to present at eyeforpharma to talk about being patient focused. Where does such passion and purpose come from? With a dad who fought at Hiroshima in WWII and a mother who had a long career as a teacher, Greg learned early about a life of service. And, as a hockey player in Europe earlier in life, he derived the habit of being a team player – working with others on a common purpose to make a difference in the world. After hockey, he began serving other athletes through a medical device company that focused on braces and neuromuscular stimulators. Three pharma companies later, he is again on a team he loves, fighting to find a way to impact outcomes for patients. “It’s always been that way for me. It’s about helping the patient and the customer – building that partnership – to help create better patient outcomes together than any of us could do alone,” says Greg. When the rest of the industry was still thinking about how to increase scripts, Greg was skating to 51 | HS&M MAY/JUNE 2019

where the puck was going – to patient centricity. “I looked around,” he explained, “It was at the height of the nuclear arms race to hire reps, and I saw the frustration it was causing HCPs. I realized also that HCPs weren’t the sole decision makers anymore. Then I had a compelling interaction with a chief medical officer with whom I built a unique friendship around hockey.” That CMO helped Greg understand how complicated the business of healthcare was. Greg remembers him saying “Imagine the inefficiency of our healthcare system being translated to the airline industry. Planes would never get off the ground!” Greg was hooked on the need to find greater efficiency in healthcare. He switched his enrollment in an MBA to a Masters in Health Systems and then a Master Certificate in Lean Enterprise Solutions. He wanted to help his company build efficiency

into customer propositions and marry what was important to the customer, the patient and the company. It went far beyond the pill, he realized, to understanding the patient journey and the customer’s work flow. How could his products help make the patient and customer journey more efficient and effective? He realized he needed to build bridges with customers, since no one could solve the problems alone. For Greg, the magic to creating those collaborations was his authentic patient focus. His education was helping him understand what was driving the healthcare decisions at the C-suite level. Greg was building an expertise that many pharma companies could use. But he was looking for something special. He admits that he’s worked in big pharma with $65 billion in sales and been dissatisfied with the work environment. It’s not about the size of the

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policy, they’re all working toward the end result for the patient. Schizophrenia and OUD are complex treatment systems that are not designed to adequately support patients. Greg says, “It’s critical that we continue put the patient at the center of decision making. Creating access to medicines in this area is challenging, but we see this as an opportunity. In building our business, we are building specialized commercial capabilities to enable us to navigate within the complex treatment systems that define these diseases. We are one of the few companies that are designed to work in these complex systems.”

Greg Apostol (VP, Alkermes)

budget but about finding a good fit – where your personal aspirations and expertise fit the mission of the company. “When I was young and naïve it was just about getting a job. As I get older, I have the luxury of determining where I work. I’ve chosen to work at Alkermes,” explains Greg. They were looking to put into place a new strategic direction for their account management and reimbursement team. Greg knew he had the expertise for this, but it was important for Greg that they had the culture that mattered to him. Alkermes felt right to him. “It makes me feel youthful and excited to come to work. We have a shared sense of purpose.” Greg says that many people at Alkermes have a personal connection to serious mental illness or alcohol or opioid dependence. “I simply remind my team how much I appreciate them for being here. Together we celebrate patient success stories. Our medicines provide treatment options for patient populations are often stigmatized or overlooked. At Alkermes, we give them a voice. I feel like to53 | HS&M MAY/JUNE 2019

gether we can accomplish anything!” He says that value is not just about what’s in it for the manufacturer or provider, it’s first about what’s in it for the patient. The overall goal is greater alignment on working together to help solve problems for patients. “We work on complex and underappreciated disease states for both schizophrenia and opioid dependence, where there are many unmet needs.” He says that in R&D, sales, marketing,

As someone who has been in the industry for more than 20 years and works closely with stakeholders across the health care continuum, it’s clear that we have an opportunity to drive impact that changes lives, communities and, most importantly, patient outcomes.” It’s that kind of attitude – on a company level and on a personal level, from people like Greg – that will provide the motivation to greatly expand the populations who benefit from medical advances. •

Jill Donahue Principal, Excellerate Author, Engage Rx: The 3 Keys to Patientfocused Growth Co–founder, The Aurora Project Jill, HBa, MAdEd, is a keynote speaker, author and thought leader who has authored two books on Influencing in patient-focused ways and co-founded The Aurora Project, a global patient-centricity group. She also serves as Associate Editor of Healthcare Sales & Marketing. Jill.Donahue@excellerate.ca

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MOTIVATION

MOTIVIDEOS By Cari Kraft, Jacobs Management Group You know the old axiom “You only get one chance to make a first impression”? Well, the same is true of every day. You only get one chance to start it properly. So that’s why we always include Motivideos here – brief reminders of what life is all about, as a way to kick off your morning meeting on a positive note. Dive in! Influence

Getting Your Brain to Focus

Underneath it all, our effectiveness lies in our ability to influence others. Here is the underlying science of influence based on the principles of Cialdini.

A good listen to gain insight on how to coach for focus. Dialing down the overstimulation of the brain and lining up those neurons to march in the right direction and accomplish the goals we’re after.

Thinking, Fast and Slow A great video to kick-off a meeting where your team will make decisions. This summary of Daniel Kahneman’s huge best-seller provides insight into questioning your fast-thinking responses, and trusting your slow-thinking, more reasoned responses.

Getting Underneath Motivation? Why do we work? We all know it’s not just for the money. Listen to this Ted Talk for insight into drivers for motivation and how to weave it into your teams every day work life.

Submissions are welcome. If you have one you like, email a link to me at ckraft@jacobsmgt.com.

Cari Kraft leads a team of master level recruiters at Jacobs Management Group, celebrating 30+ years of executive recruiting in the healthcare (pharmaceutical, medical device, biotechnology) and high-tech industries, nationally. Prior to joining Jacobs Management Group, Ms. Kraft has held positions as a Senior Sales Executive, Director of Business Development and Director of Marketing. She also has deep knowledge of the technology/startup fields, having been in the industry through the rise of the Internet. Ms. Kraft is a University of Pennsylvania/Wharton alumnus holding a degree in economics and decision sciences. Cari can be reached at ckraft@jacobsmgt.com.

COMMENT 55 | HS&M MAY/JUNE 2019

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Getting Your Brain to Focus

Getting Underneath Motivation?

HS&M MAY/JUNE 2019 | 58

INDUSTRY

What are Our Clients Saying? Top Problems Healthcare Execs are Facing Excerpts from a national survey of healthcare stakeholders commissioned by the HealthCare Executive Group and Change Healthcare The 9th Annual Industry Pulse Research Report shares the organizationsâ&#x20AC;&#x2122; insights on the critical issues, challenges and opportunities ranked by HCEG members on the 2019 HCEG Top 10 list. The report shows Data & Analytics ranking as the #1 opportunity: leveraging data (especially clinical) to manage health and drive individual, provider and payer decisions. Patient portals (73.1% of respondents are using them) and telehealth servic-

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es (54%) top the list, establishing these as digital cornerstones. Most respondents said clinical data integration is also key, with only 10.9% saying they have no plans to implement it. Pricing and payment have always been important to patients; the same now goes for healthcare stakeholders, with digital payment options and cost transparency apps making a strong showing here.

Automation in the form of machine learning and AI has the highest potential in the minds of respondents, with just over half planning to employ it. By contrast, robotic process automation drew the largest chorus of noâ&#x20AC;&#x2122;s, with 47.2% saying their organizations would not use it. See the full report here: 9th Annual Industry Pulse Survey

Pulse Chart 1

EXECUTIVE SUMMARY Few industries have experienced the sustained disruption to their business models as has healthcare. No matter where you look—whether it’s care, cost, consumerism, consolidation, payment models, HIT, or regulation— healthcare is in a constant state of change. And the pace of change is accelerating. Healthcare leaders must continually assess their organization’s strengths, weaknesses, opportunities, and threats to remain competitive. This year’s research draws from 185 healthcare leaders, 28% of whom are at the president or Csuite level, 48% VP-level or above, and includes HCEG members, Health Plan Alliance members, and Change Healthcare customers. The report provides a timely snapshot across 16 crucial topics, including market trends, popu-

lation health, value-based care, consumer engagement, clinical and data analytics, risk sharing, social determinants, cybersecurity, and more.

might indicate payers and providers are struggling in their efforts to scale complex value-based care and reimbursement models from pilot to production

While there are many insights and takeaways to consider in this year’s report, a few stand out:

• Consumer demand for better access, price/cost transparency, and convenience is opening doors for external competitors who can provide a retail consumer experience. Established players will be challenged to stay ahead

• Outside influences are intensifying. A confluence of forces – people, processes, and technology – will require healthcare to turn to new business models and market strategies. Most notable among these are non-healthcare entrants to the marketplace, whose consumer-centric innovations could help re-imagine patient engagement • A healthcare market where the majority of value-based relationships include both upside and downside shared risk still appears to be three to five years off. This

HEALTHCARE AMID CONTINUED UNCERTAINTY REFLECTED IN HCEG TOP 10 & INDUSTRY PULSE • External Market Disruption (#7) entered the HCEG Top 10 list for the first time and is confirmed by the Industry Pulse Report with 32.2% of respondents anticipating the greatest impact to be “disrupting current business models” HS&M MAY/JUNE 2019 | 60

INDUSTRY Pulse Chart 2

• Payment Reform/Value-Based Payments (#4) has been on the HCEG Top 10 list every year for the last decade. 63.6% of the Industry Pulse Report respondents expect it will be 3 years or more before payments contain both upside and downside risk. The report goes deeper into what needs to happen to orchestrate high-value care • Consumerism (#2), Mobile/ Digital Health (#5) and member engagement have ranked high in the HCEG Top 10 for a number of years. This year’s Industry Pulse Report shows the tools and services being used to enhance member/ patient engagement and the best approaches for addressing passive patients, such as incentives, health literacy and cost transparency tools. • The Data & Analytics (#1) to support multiple healthcare 61 | HS&M MAY/JUNE 2019

priorities is highlighted this year. Progress in how primary sources of clinical data and analytics have recently been impacting the efficiency and effectiveness of healthcare quality and outcomes are also suggested • Population Health/Social Determinants of Health (SDoH) (#3) moved higher in the HCEG Top 10 as the industry transitioned from broad medical condition segments of the population to looking at what is called “barriers to better health.” Industry Pulse survey respondents shared how their organizations are integrating SDoH and which non-medical barriers to care their organizations will take action on in the next 12 months. Also noted are anticipated challenges to integrating SDoH into population and clinical care

programs RESEARCH BACKGROUND AND METHODOLOGY Survey, Screening Criteria, and Data Collection See Pulse Chart 1 The Industry Pulse is an annual healthcare industry survey designed to provide directional insight on opportunities, challenges, and trends facing the healthcare market. The research focuses on payer organizations, but includes the perspectives of other industry stakeholders such as provider organizations and vendors. Developed in partnership with the HealthCare Executive Group (HCEG), this is the 9th annual Industry Pulse survey. It mirrors the HCEG Top 10 priorities list compiled by HCEG members during

their Annual Forum. The national research sample draws from more than 2,000 Change Healthcare customers, including leading national and regional payers; nearly 40 HCEG member organizations; and 50 Health Plan Alliance members. The researchers targeted the leaders of these organizations, 48.1% of whom are at the President, Vice President, and C-suite levels. INCENTIVES HELP PEOPLE ENGAGE AS CONSUMERS Rewarding healthy behaviors gets members and patients thinking See Pulse Chart 2 How can organizations turn passive patients into active consumers

of healthcare? Nearly half (49.3%) of respondents said that offering patients incentives for healthy behaviors is one of best tools for engaging them as consumers.

become a consumer of healthcare.

What’s the least effective move to make consumers of patients? Sign them up for a high-deductible health plan. Only 3.8% of respondents endorsed this as a consumer engagement strategy.

External market entrants bring strengths in care delivery and customer experience

High-deductible health plans are great for cost control, but a poor means for getting patients to think about how to shop for and use their healthcare. As a whole, the ranking of options in this question matched last year’s results. This consistency suggests that healthcare leaders have a clear picture of how they believe the patient can

BIG TECH AND RETAIL WILL DISRUPT HEALTHCARE–BUT HOW?

See Pulse Chart 3 2019 survey respondents have a wary eye on the disruptions that external market entrants like Amazon, Walmart, Google, and Apple will have on healthcare. Nearly one-third (32.2%) said the greatest impact of big tech and big retail will be on the business models that now dominate. This response suggests that healthcare leaders recognize that external entrants will force the industry to change how it conducts busi-

Pulse Chart 3

HS&M MAY/JUNE 2019 | 62

INDUSTRY Pulse Chart 4

Pulse Chart 5

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Pulse Chart 6

ness. Asked to name more specific disruptions that external entrants might create, respondents provided a wide variety of perspectives. Placing second and third after business models were innovations in care delivery (13.3%), and refinement of consumer experience (11.1%)—which aligns with the inherent strengths of retail and technology market entrants. With all these uncertainties, one thing is sure: Industry concern over external disruption is wide-

spread. PATIENT ENGAGEMENT IS CRITICAL TO HEALTHCARE CONSUMERS Payers and providers offer a mix of tools See Pulse Chart 4 Most healthcare stakeholders consider patient engagement tools and services to be strategic necessities. In this era of consumer-driven healthcare, if providers or payers fail to make partners of their patients or members, they run the risk of losing them. For the first time, the Industry Pulse survey asked about patient portals—nearly 15% of respondents use these—and personalized content, which came in much low-

er at 6.9%. The lack of personalization likely limits the effectiveness of educational materials, which ranked high among responses at 15.2%. Only 11% said their organizations are identifying members’ communications preferences. The industry will have to do better on this—and on delivering a more engaging consumer experience, which should include many of the features that this question asked about. CLINICAL DATA SOURCES ARE ON THE MOVE Use of health information exchange rose sharply See Pulse Chart 5 We’re witnessing an evolution in the mix of clinical data sources HS&M MAY/JUNE 2019 | 64

INDUSTRY Pulse Chart 7

that providers and payers use in the late 2010s. It’s no surprise that more and more data is being pulled from the EHR (30.1%), where core clinical data lives. But the number of respondents naming health information exchange (HIE) data more than doubled in just a year, from 3.8% in 2017 to 9.1% in 2018. That jump is an encouraging sign that this mode of data exchange has gained a foothold. Rising integration of information from patient health surveys (9.1%) with EHR data indicates that stakeholders are giving focus to individual patients, not just population health. Lagging are fundamentals like real-time data on hospital admissions and discharges. Improvement in these measures would 65 | HS&M MAY/JUNE 2019

bode well for coordination of care across providers. ANALYTICS IS BOOSTING QUALITY IN THE LONG RUN Mixed picture in 2018 belies the broader trend of improved outcomes See Pulse Chart 6 The industry continues to make better use of clinical and data analytics to improve care quality and outcomes. Progress was limited in the last year, which may be related to issues around data sharing, a lack of standardized formats, and concerns regarding privacy and data ownership. Data analytics is having its biggest impact on the effectiveness and efficiency of workflows, according to respondents. Some 30% said analytics is extremely or very

effective in doing so. Similarly, 28% said analytics is extremely or very effective in empowering more productive providers. Analytics were of the least use in reducing healthcare costs. Some 16% of leaders said that in the cost realm, data analytics have been “not effective,” roughly double the percentage who gave this answer for the other areas where analytics might help. NEEDED: FINANCIAL INCENTIVES FOR DATA SHARING The prerequisite data standards and interoperability are sorely lagging See Pulse Chart 7 “Money makes the healthcare world go ’round.” We could draw that conclusion just by perusing

Pulse Chart 8

the diverse but thematically linked written responses to the open question about what would motivate stakeholders to share data that helps drive clinical decisionmaking. It’s all about financial incentives for data exchange, the bulk of respondents said. Some 19 healthcare leaders mentioned money. Value-based care includes monetary incentives—carrots and sticks tied to quality metrics and outcomes. VBC demands close payer-provider collaboration. In fact, collaboration and integration are where another 15 respondents put the onus for incentivizing data sharing. You can’t exchange data without integration and the prerequisite standards and interoperability.

DIGITAL HEALTHCARE IS ON THE MARCH A groundswell of stakeholders plan to use AI The industry continues to take strides into its digital future. Patient portals (73.1% of respondents are using them) and telehealth services (54%) top the list, establishing these as digital cornerstones. See Pulse Chart 8 ABOUT HCEG The HealthCare Executive Group is a national network of healthcare executives and thought leaders who come together as a group to navigate the strategic and tactical issues facing their organizations. HCEG provides a platform for its members and sponsor partners to promote healthcare innovation, technology and the development

of lifelong professional relationships. HCEG was founded in 1988 by executives looking for a forum where the open exchange of ideas, opportunities for action, collaboration and transformational dialogue could freely ensue. ABOUT CHANGE HEALTHCARE Change Healthcare is inspiring a better healthcare system. Working alongside our customers and partners, we leverage our software and analytics, network solutions, and technology-enabled services to help them improve efficiency, reduce costs, increase cash flow, and more effectively manage complex workflows. Together, we are accelerating the journey toward improved lives and healthier communities. Learn more at changehealthcare.com. •

HS&M MAY/JUNE 2019 | 66

INDUSTRY

Why I Work in Healthcare: Executives from Merck, Horizon, Shire and More Comment on Our Future We have run several articles featuring people expressing their passion for this industry, and offering the reasons why they chose this as their profession. Recently, at Digital Pharma West, exl Pharma did something similar, asking attendees about the future of the industry. We appreciate their providing us with some samples of the answers, as shown below. You can see the whole video here.

AMANDA PHRANER

“[It will be] more personalized, and there will be more opportunity for individuals to find what they need when they need it.”

JACKIE PHY

“We’re going to see that direct connection well done between patient and doctor.”

KARA LANDRIGAN

“I think our marketing will evolve to become more patient-focused…more direct communication on a one-toone interaction.”

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KRISTEN WINTERS

“We’ll be bringing more targeted messages to patients, so they’ll be more educated. And through that, we’ll be getting more feedback from them.”

MARVIN JOHNSON

“We’re going to be engaging patients in a different, very meaningful way… in real time.”

IZETTA PHILLIPS

“I see 3D technology and virtual reality technology informing the way we look at performance management.”

MICHAEL BANKS

“More personalized, more intimate, and focused on the individual patient.”

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NEW! AGENCY AND PROVIDER DIRECTORY! Healthcare Sales & Marketingâ&#x20AC;&#x2122;s New Feature As a value to the industry, we have initiated a project to profile the top agencies so that you have them at your fingertips. We are compiling digitally a searchable single source to give you access to the whoâ&#x20AC;&#x2122;s who, their strengths, vision for the future, leadership and strategies, so that you can get a better feel as to how they work. We are driven by the input of our readers so please let us know if you have an agency or provider you would suggest we profile. You will see some of the best with links to all their websites, their philosophy and history, as well as what makes them special. This is all in keeping with our goal of having the hottest industry companies and the top thought leaders in in the pages of every issue of HS&M. Our goal is to constantly expand the value we bring to you.

If you would like to be featured, or have an agency or provider to recommend, please reach out to our Associate Publisher, Natalie Newcamp, at nnewcamp@hsandm.com.

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You already know if you're a winner. Your patients are telling you. Now its time for you to be recognized by the entire industry at the eyeforpharma Awards. Nominations are NOW OPEN.

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AGENCY & PROVIDER DIRECTORY MAY/JUNE 2019

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AGENCY & PROVIDER DIRECTORY

Company Overview: Founded by doctors, engineers and data scientists, COTA is committed to bringing a patient first approach to cancer care through the use of real-world evidence. The Company organizes fragmented, often hidden data from the real world to provide clarity in cancer care. Combining clinical expertise in cancer with proprietary technology and advanced analytics, COTA’s platform helps inform decisions and action in oncology. COTA partners with providers, payers, and life science companies to ensure that everyone touched by cancer has a clear path to the right care. To learn more about COTA and how to make better decisions with the right data, visit cotahealthcare.com. Address: 100 Broadway, 7th floor New York, NY 10005 Phone Number: 866-648-3833 Website: www.cotahealthcare.com Social Media: https://twitter.com/cotahealthcare https://www.linkedin.com/company/cotainc https://www.Facebook.com/COTAInc/

Leadership: Mike Doyle – President & Chief Executive Officer • Andrew Nordon, MD – Chief Medical officer • Elizabeth Rushforth – Chief Legal Officer • Bernard Chien – Chief Technology Officer • Vivek Kumar – Senior Vice President, Operations and Delivery • C.K. Wang, MD – Senior Medical Director, Clinical Oncology • Elizabeth Lamont, MD – Senior Medical Director, Outcomes Research New Business Contact: Jaimee Ryan 617-733-5509 Jaimeeryan@cotahealthcare.com Year Founded: 2011 Number of People: 100 Areas of Expertise: Cancer care, real-world evidence, real-world data, precision medicine, oncology, technology. What’s New: COTA recently won the Health Tech Challenge at the eyeforpharma conference in Philadelphia! Our senior medical director, Dr. C.K. Wang discussed how real-world evidence can answer key questions in cancer care. COTA has some exciting news coming down the pipeline, so be sure to check back on our social pages for updates and news announcements including a brand new website!

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AGENCY & PROVIDER DIRECTORY

Company Overview: LIFT is an independent healthcare research, design, and marketing communications firm serving the life science space—particularly the pharmaceutical, biotechnology, and medical device industries. Headquartered in Chattanooga, Tenn. with offices in West Palm Beach, Fla. and Raleigh, NC, LIFT approaches its core competencies of insights, branding, storytelling, and content marketing through the lens of design thinking—leveraging the practice of anthropology, ethnography, and extreme stakeholder empathy to generate truly human-centric results at all stages of the consumer and product development lifecycles. To learn more, visit www.lift1428.com. Address: 600 Georgia Ave, Suite 1, Chattanooga, Tenn. 37402 Phone Number: 423-509-6721 Website: www.lift1428.com.

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Leadership: David McDonald – Founder and CEO Diane McDonald – Founding Partner and COO Brian Shakley – Executive Vice President and Partner Dave Chlastosz – Executive Vice President and Partner Chris Snell – Executive Advisor Of-Counsel New Business Contact: David McDonald David@lift1428.com 423-596-2635 Year Founded: 2012 Number of People: 12 FTEs + Expanded Roster of Contracted SMEs Areas of Expertise: Stakeholder Research (Qual/Quant), Design Thinking, Organizational Development, Stakeholder Education/Activation Strategy (Pre- and Post-Marketing), Custom Content and Publishing, Documentary Film Production, Commercial Marketing and Advertising

AGENCY & PROVIDER DIRECTORY

Company Overview: McCann Managed Markets is a strategic health care communications agency specializing in managed care marketing. We develop customized solutions across the managed markets value chain for a range of customer segments, including payers, health systems, organized provider groups, employers, pharmacists, office staff, and patients. Guided by our expertise in strategy, launch execution, and innovative solutions, we are well equipped to help clients navigate the complex and evolving managed markets landscape. As an integrated part of McCann Health, a global network of companies across 6 continents, we work on multiple cross-portfolio deliverables for our clients. Address: 49 Bloomfield Avenue Mountain Lakes, NJ 07046 600 Battery Street San Francisco, CA 94111 Phone Number: 973-917-6623 Website: www.mccannmanagedmarkets.com

Leadership: Kim Wishnow-Per President New Business Contact: Roshan Rahnama roshan.rahnama@mccann.com 862-777-0742 Year Founded: 2002 Number of People: 66 Parent Company: The Interpublic Group Awards: 2016 Healthcare Network of the Year—Lions Health 2017 Healthcare Network of the Year—Lions Health 2018 Med Ad News Best Managed Markets Campaign Areas of Expertise: Market access, above-brand solutions, patient access and reimbursement, pharmacy, and integrated pull-through. What’s New: We have an additional office in California Brand/initiative wins: 12

Social Media: www.facebook.com/McCannManagedMarkets/www. linkedin.com/company/mccann-managed-markets/ www.instagram.com/mccannmanagedmarkets/

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AGENCY & PROVIDER DIRECTORY

Company Overview: We connect pharmaceutical brands to the right consumers from the moment they begin their search for health options in our premier network of pharmacies and continuing to do so wherever their healthcare path may take them. Rx EDGE Media Network is a leader in the healthcare marketing industry with over 18 years of experience delivering hundreds of successful campaigns for pharma brands. Even as media consumption becomes increasingly dispersed, the pharmacy exists as the single mostoften visited healthcare destination in the lives of Americans, and combined with digital technologies, it produces an exceptionally broad reach. Address: 111 Water Street East Dundee, IL 60118 Phone Number: 800.783.7171 Website: www.rxedge.com Social Media: LinkedIn: https://www.linkedin.com/company/ leveragepoint-media/ Twitter: @RxEDGE Leadership: Nate Lucht, President and CEO nathan.lucht@leveragepointmedia.com New Business Contact: Michael Byrnes, EVP Sales Michael.byrnes@rxedge.com 610.431.7606 Year Founded: 2000 Parent Company: LeveragePoint Media | LLC 75 | HS&M MAY/JUNE 2019

Awards: PM360 Trailblazer Awards PM360 Elite Awards DTC Perspectives Advertising Awards PM360 Pharma Choice Awards Service Focus: Rx EDGE Media Displays: Through our prominent, strategically-placed displayed delivered in a network of 27,000+ retail pharmacies, we help pharmaceutical brands motivate consumers at the most relevant times…when they are actively searching for ways to take care of themselves. Our Media Displays enlighten, engage, and inform. Rx EDGE Unlimited™: This cross-channel solution combines the power of our brick-and-mortar network with premium digital inventory and advanced analytics to bring pharma brands and audiences together. Rx EDGE Unlimited delivers exceptional reach, frequency, and influence. Insight EDGE™: A suite of data resources that the Rx EDGE analytics team applies to every program to ensure that pharma brand messages are seen by the right consumer. Areas of Expertise: We Maximize Impact: Rx EDGE is the only targeted media platform that uses the pharmacy as a consumer’s gateway to immediate information as well as ongoing connections to the pharma brands that are relevant to their healthcare needs. Brands that use Rx EDGE programs see an average script lift of 12.5%. We Align the Right People, Places, and Times: Through our relationships with key retailers, we can access data not commonly available through other marketing service providers − making our Insight EDGE™ targeting platform unique in the pharma marketing space. We Offer Proven Results: Measurement defines the core value we bring to every initiative. Using thirdparty analytics, results are evaluated with a significant level of precision. In addition to a lift in prescription volume, our programs also result in an average return on investment of $8.12. What’s New: Rx EDGE Unlimited™ is a new cross-channel approach that combines Media Display, mobile, and programmatic digital ad placement to boost campaign effectiveness.

AGENCY & PROVIDER DIRECTORY

Address: 12809 Mirabeau Pkwy, Spokane Valley, WA Phone Number: 509-242-0767 Website: www.NextIT.com Social Media: www.linkedin.com/company/verint/ twitter.com/Verint Leadership: Michael Southworth, GM Tracy Malingo, SVP Product Strategy Joe Dumoulin, CTIO Mitch Lawrence, SVP Commercial Sales New Business Contact: Nick Genatone ContactNextIT@Verint.com Phone 509.242.0767 Year Founded: 2002 Number of People: 270 Service Focus: Conversational AI, Intelligent Assistants Parent Company: Verint Awards: AI Breakthrough, Best Overall AI Solution • NextGen Innovation of the Year • eyeforpharma Most Valuable HCP Initiative • Fierce IT Healthcare Fierce Innovation Award • PM360 Innovator, Product Pick • PM360 Marketing Initiative of the Year

Areas of Expertise: Verint Next IT, a division of Verint, is the team the life science community counts on for intelligent solutions to modern healthcare problems. We unlock the value of human relationships with the power of conversational AI. Verint Next IT has delivered the broadest portfolio of AI-powered, conversational Intelligent Virtual Assistants configured for Diabetes, Multiple Sclerosis, Parkinson’s disease, and Women’s Health, with several more launching in the coming months. The technology is configured to improve health outcomes, provide access for patients and caregivers to product and health literacy, connect physicians to patient data, and improve the overall experience for patients, healthcare providers, and consumers. To learn more, visit www.NextIT.com. What’s New: • “Ask Sophia’, Novo Nordisk’s new online and smart speaker intelligent assistant, available 24/7 on Cornerstones4Care.com and Amazon Alexa via “Ask Digital Sophia” for diabetes questions • UCB’s New PD Coach App “April” launched to support those living with Parkinson’s Disease, available in Apple and Android app stores. April address specific challenges that Parkinson’s patients and their caregivers may face – including the ability to learn and adjust to language and vocabulary for patients with dexterity and speech issues.

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May / June 2019

Articles inside

Merck, Shire, and other Execs on ‘Why I Work in Healthcare

Pulse Report: What Are Healthcare Execs Saying?

Industry Trends: By The Numbers

2019 Global Life Sciences Outlook by Deloitte

Great Minds: Alkermes VP, Greg Apostol, on How to Create a Better Team

Novartis, Takeda and Others Win Innovation Awards

Spotlight: Astellas U.S. President, Percival Barretto-Ko, on Purpose, Pricing, and Better Access to Healthcare

Motivideos: To Use In Your Meetings

Editorial Board

Editor’s Letter