No innovation strategy works for every company in every industry, and the same applies for pharma. Understanding the specific nature of change can help you determine those strategies that are likely to work and distinguish those which won't.
Be on guard for the following pharmaceutical trends dominating 2016 and set the right course for your 2017 strategies.
1. Pricing pressure
Pharmaceutical companies are under pressure to lower the cost of drugs as patients, politicians and physicians call for drop in their prices. This effort was intensified after August 2015, when the CEO of Turing Pharmaceuticals increased the price of Daraprim, a drug important for the treatment of toxoplasmosis or acute malaria, by 5,000%.
The times when all patients went directly to the doctor when they got sick and had medication prescribed are gone. Patients today are more empowered as information is easily accessible. They can learn about their health conditions online and get the necessary knowledge to be aware of the various treatment alternatives and choose the one they prefer most. Doctors have lost their power to influence this choice and therefore pharma companies have to start looking for new ways to get their medications sold.
3. Personalized medicine
Rapid-fire advancements in genomic technologies, data science methodologies and significant public and private sector programs and investments have made it possible for modern medicine to get very close to realizing the goal of personalized medicine. Statistics have revealed that approximately 94% of pharma companies are actively researching specialized therapies.
4. Specialty drug spending
Currently, the industry's focus has shifted to specialty drugs, as they target complex diseases that place high in value but low in competition. Due to their increased demand, a 50% rise of all prescription drug spending is forecasted by 2018.
One after another, the patents on many blockbuster drugs are expiring, leading to increased competition on the generics market. Globally, a 36% increase is forecasted in terms of volume (to the value of $421 billion) by 2017. The market for the development and sale of biosimilars is predicted to reach $35 billion by 2020.
6. Tech giants involvement
In recent years, pharma companies have encountered the entry of tech companies such as Google, Apple and IBM. With massive amounts of health-related data collected and processed by tech giants, pharma companies can gain a better understanding of diseases, broaden their R&D strategies and better focus the treatments. Google's smart lens for diabetes is an example of a more convenient way for patients to monitor their health thanks to technological innovation.
7. Going digital
Big data, digital technology and the internet are constantly transforming every sphere of our day-to-day lives. Pharma is not fully there yet; however, there are 5 digital health innovations reshaping pharma industry.
8. Regulatory intelligence
Regulatory changes are not new for pharma, nor will they soon come to an end. In 2015, 243 new guidance documents were issued, compared to only 117 in 2012. In today’s world, a seemingly small shift in the business or regulatory environment can have huge ripple effects. A study by the MIT Center for Digital Business revealed that data-driven organizations reported 4% higher productivity rates and 6% higher profits than others. These numbers are hard to ignore because they can make a significant difference to the bottom line. As the recent progress in the pharmaceutical industry has brought a great amount of data and information, it is worth at least considering the reasons why to invest in Regulatory Intelligence.