By Heather Fraser Life Sciences & Healthcare Leader, IBM Institute for Business Value
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PHARMACEUTICALS: THE ROAD AHEAD
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t is detrimental for any industry to be stuck in a rut. Take for example the pharmaceutical and life science industry. This industry as a whole has resisted developing new business models. The end result: declining research and development (R&D), expiring patents on blockbuster drugs and therapies, shrinking sales forces and increasing demand from customers and payers for more innovative products. The industry is now at a crossroads. Its business model looks dated in a healthcare ecosystem that is changing dramatically. So how should companies respond? Should it be business as usual, with a possibility of fading into insignificance? Or should companies completely rethink their ways of engaging with all the stakeholders in an effort to flourish anew? In today’s increasingly complex and fast changing environment, business model innovation is critical to success. To compete more effectively, the industry
must develop new business models, fuel innovation in R&D and drive greater discovery. The way forward involves developing strategies in support of advanced therapies and technologies; maximizing development by integrating modeling and simulation with clinical trial programs; using social networking to connect globally to gather insights; collaborating more effectively throughout the company, and with partners and suppliers. Those who choose to engage more fully in the healthcare ecosystem and drive outcomes with solutions that extend ‘beyond the pill’ will play a new and transformational role. For instance, pharmaceutical companies could investigate how to augment their lifesaving products with services that complement them. A recent University of Alberta research initiative demonstrates how scientists there used software to study elderly clients who volunteer to stay in an independent living suite at the local rehabilitation facility. The suite is instrumented with sensors
and equipped with smart devices collecting information about their daily activities. A key part of the study was focused on ensuring these elderly patients correctly took their prescriptions. The data is used to make better use of healthcare resources, enable remote collaboration among providers and contribute to early intervention and long-term management of chronic diseases. This type of innovative research can be used to extend the length of time seniors are able to live in their homes. To truly thrive and innovate, pharmaceutical companies need to make a similar transition by taking on a larger role in helping patients with their healthcare, and in the process, open up new market opportunities. This would mean forming partnerships with insurers and healthcare providers to promote adherence to prescriptions. By creating services related to its life-saving products that help patients deal with their illnesses and reduce discharge times, or eliminating the
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