Tag Archives: Healthcare

Post Covid-19 Lockdown: Is Pharma Industry Ready?

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It’s over a month now since national lockdown in India came into force to win the war against Covid-19. Many promises and apprehensions about whether or not Covid-19 will keep ravaging human life, continue surfacing. As it appears today, whatever best happens post May 03, 2020, the Coronavirus outbreak is going to change the way we live and the businesses used to operate, in many respects, till an effective vaccine comes, at the very least. This change also includes the health care, in general, and the pharmaceutical industry, in particular.

It is obvious now that Covid-19 will stalk the planet for a long time to come. On April 22, 2020, the World Health Organization (WHO) also reiterated: ‘Make no mistake, Coronavirus will be with us for a long time.’ This vindicates many apprehensions against an early promise of winning the Covid19 war decisively in 21-days or even by May 03, 2020, or whenever the national lockdown is phased-out in a calibrated manner. Further, W.H.O has also cautioned: “Most countries are still in the early stages of their epidemics. And some that were affected early in the pandemic are now starting to see a resurgence in cases.”

As on April 26, 2020, the recorded Coronavirus cases in India has sharply climbed to 26,496 and 825 deaths, with the Union Health Ministry saying on April 23, 2020: ‘Doubling rate of Covid-19 cases in country is now 10 days.’ Whereas, on the same day, Indian Council of Medical Research (ICMR) also said, ‘for now, it is very difficult to tell when a peak state of COVID-19 pandemic in the country will arrive.’

The life-changing disruptions that Covid19 has caused, and may continue to cause in the near future, has apparently made a significant impact, also on how the healthcare consumers think about the available disease treatment solutions, including buying medicines. Thus, in this article, I shall, focus on this area.

Why winning the Covid-19 war can’t be immediate: 

Covid-19 pandemic brought the drug industry under a sharp focus of the entire world, with an expectation to win the war against this deadly and invisible virus. This solution could be anything – an effective prevention, such as, with a vaccine, or a curing the infection with a drug, or even a mechanism that is able to make the virus less contagious. There are still no scientifically proven and approved drugs or vaccines for Covid-19. Although, many trial and error experiments are in progress, mainly based on anecdotes and gut-feeling, for the respiratory disease caused by Coronavirus.

The good news is, since January 2020, after scientists in China provided the virus’s genetic sequence, over 40 teams of global drug companies and the academia, are working on a vaccine and drugs for Covid-19. As of now, six Coronavirus vaccines are on clinical trial. Last Thursday, human safety trial of Oxford University developed Covid-19 vaccine, with the first two of 800 healthy volunteers, has commenced. Meanwhile, Serum Institute of India (SII) has tied-up with the Oxford University to manufacture the vaccine in India, if the trial succeeds.

Some bad news in this area also came by, such as, ‘remdesivir’ – the well-hyped drug, thought to be one of the best prospects for treating Covid-19, failed to have any effect during the first full trial. However, Gilead – the drug company developing this product has said, ‘the findings were inconclusive because the study was terminated early.’

The bottom-line is, although, first tests for more new vaccines may commence within a few months, the final regulatory approval of these will take much longer - at least 18 months, i.e. not before 2022, according to W.H.O. Meanwhile, some disruptive changes within current health care delivery systems, involving both behavior and transaction practices of key stakeholders, may prompt equally disruptive changes in the Indian health care delivery mechanisms. These changes are likely to have unforeseen impact on several pharma operations, critical for business excellence in the drug industry.

Commonly followed procedures for the Indian healthcare system:

The procedures that most health care consumers currently follow for healthcare in India, require patients to be physically present in most touchpoints of a disease treatment process. These include, doctors, chemist shops, hospitals, diagnostic clinics, among others. During the national lockdown period, redressal of non-Covid-19 related common health issues, has been a great challenge for many people, such as:

  • visiting a doctor
  • going to a hospital outdoor
  • procurement of medicines from retail shops for chronic conditions
  • visiting a diagnostic clinic even for follow-up – previously advised by a doctor

This happened primarily due to the need of compliance of social distancing and mostly out of fear of getting the Covid-19 infection. Fortunately, the available digital platforms to address the pressing common health issues, proved to be of immense help to many.

Pharma business has also been greatly impacted: 

Driven by initial panic buying of regular medicines by the people, for the lockdown period and may be beyond, monthly sales of pharma might show a spurt. But, that is unlikely to be the real picture for a medium to long term. Otherwise, like many other industry sectors, pharma business has also been greatly impacted by the Covid-19 outbreak, across its various domains – right from planned R&D – through manufacturing, sales and marketing – to supply chain.

The early adopters to the new normal will be the outright winners:

For example, meeting a doctor for product detailing following the conventional chain of activities, and simultaneously maintaining strict ‘personal distancing’ or ‘social distancing norms, may not be the same again. The changes required by the pharma companies to make this process effective and productive, may also be disruptive in nature.

No-one can accurately predict toady, how exactly the important business operations can be resumed, ensuring full health-safety for all and with compromising on the effectiveness and productivity of business. Nevertheless, one thing for sure, lockdown during Covid-19 pandemic has brought the possibility and the opportunity of going digital to the fore, for both – the healthcare business and also its consumers, including various other stakeholders. The early adopters to the new normal are expected to be the outright winners.

Green shoots of digitalization within healthcare consumers and providers: 

As digital transformation at health care consumers and providers level, gain a critical mass, the healthcare business would require to be not just digitalized, but also digitally innovative. The situation would demand from them to be much more ‘customer centric’ on digital platforms, as the locked down – homebound health care consumers, complying with ‘social distancing’ norms, get increasingly more digitally empowered.

Bain & Company in its March 20 ‘Brief’, titled ‘How the Coronavirus Will Transform Healthcare in China,’ discussed some of these issues from China perspective, which are already visible there. To illustrate this point in this deliberation from the Indian perspective, let me draw examples from the country’s health care consumers’ standpoint.

Is the traditional health care system slowly undergoing a metamorphosis?

The overall impact of Covid-19 outbreak in India has made visiting general practitioner’s (GP) clinics, pathological labs or even hospital emergency facilities, a tough challenge for many patients. This is primarily out of fear of getting a Coronavirus infection from others during the process, with strict compliance to ‘social distancing’ becoming a top priority for many. Consequently, traditional healthcare related activities in India, is likely to undergo an early metamorphosis.

Being literally locked down at home, a good number of healthcare consumers in India, are utilizing innovative digital platforms, for common illnesses or follow-up consultations, such as:

  • for medical consultation on digital platforms, e.g., Skype, Facetime etc.
  • getting diagnostic tests done at home by requesting through digital apps,
  • sending test reports to doctors digitally,
  • getting doctors prescription through digital mode,
  • ordering medicines through e-pharmacy apps by uploading prescriptions,
  • getting medicines delivered at home after e-payment,
  • repeating the same process whenever required.

An upside of the situation: 

The upside of the situation is, these patients are feeling more digitally empowered and self-reliant to get non-too-serious ailments addressed against all odds. Some of these practices, such as, online consultation with doctors, getting most of the medical tests done at home, buying medicines through e-pharmacies, I reckon, may continue even after calibrated withdrawal of the national lockdown in India.  The net impact of all could trigger a meaningful attitudinal change in patients, especially towards health care delivery processes, in general.

The healthcare industry is ready to log on to this digital mode? 

Many early adopters in the global pharma industry, are going for digitalization within various functional domains of the company, at a varying scale. This has started happening in India, as well. However, as social distancing becomes the new normal in the foreseeable future, how prepared are the pharma companies to adopt themselves with the increasing number of digitally empowered consumers, is still unclear. More importantly, how will the industry meet new demands at various points of transaction and interaction with various critical stakeholders, such as, doctors, in the post Covid-19 eraof social distancing, ensuring health safety of all?

Another requirement that should form the bedrock of the grand integrated corporate strategy of a customer-centric pharma business, necessarily, in the changing times. This is – all decisions in this area must be based on a huge pool of contemporary data, analyzed by sophisticated data analytics and thereafter, the strategic and tactical pathways need to be charted, desirably, through skillful application of Artificial Intelligence (AI), because of evolving complex and multi-dimensional health care needs of the consumers.

Alongside, telemedicine in different new formats – even for GP level consultations, besides, drug procurement through e-payment from approved e-pharmacies by uploading doctor prescriptions, signal a great potential in the years ahead. This appears to be very close to reality, especially, going by the W.H.O prediction for a long-haul Covid-19 battle, where compliance with ‘social distancing,’ is one of the basic requirements of health safety for all.

Conclusion:

‘Month of lockdown impedes virus – a long battle lies ahead’. As the former President of the Unites States twitted on April 25, 2020, ‘If we want life to approach anything like normal anytime soon, we need a comprehensive testing program. It’s not going to be cheap, but it will ultimately pay off many times over in saved lives, saved businesses, and saved jobs.’

In any case the crux of the matter is, Covid-19 is not going to vanish soon, even after scaling down of the lockdown in a calibrated way. Moreover, the fear, if not the panic of a large population in India and around the world, on the possibility of getting infected by Covid-19, will continue – till one does not get vaccinated or acquire ‘herd immunity’ in a different way. Meanwhile, related behavioral changes and habits, of a large number of people, including health care consumers, will continue taking place.

From this perspective, besides the existing ones, once the lockdown-period-converted ‘e-consumers’ of health care get used to the new digital mode of availing healthcare services against e-payments, it could have a snowballing impact on many others. That will help usher in a new paradigm of medical consultation, follow-up interaction, disease diagnosis, drug procurement and all related transactions, through digital platforms.

Having experienced the convenience and user-friendliness of the digital mode, during an extended period of social or physical distancing and other new normal, instead of time-consuming legwork, it seems unlikely that the majority will try to go back to the traditional mode of pre-Covid 19 era. In that situation pharma companies will have no option but to necessarily re-engineer the business operations, bringing disruptive digitalization at the center of any strategy formulation related to mainly patients and doctors, besides others.

Covid-19 prompted lockdown and the post lockdown period, I reckon, is unlikely to be a ‘switch-off’ and ‘switch-on’ type of a situation for anyone or any industry, as threat of getting Coronavirus infected will continue for quite some time. The need of the hour for pharma players in India, therefore, is gaining deep insight, through continuous data capturing and analysis, on each component of the changing market dynamics – prompted by Coronavirus pandemic. The point to ponder, therefore, is pharma industry getting ready for a possible disruptive change in the future environment?

By: Tapan J. Ray  

Disclaimer: The views/opinions expressed in this article are entirely my own, written in my individual and personal capacity. I do not represent any other person or organization for this opinion.

Acid Test For Excellence in Crisis Leadership

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On April 12, 2020 – in the morning of the day 19 of the national lockdown, India’s total number of Coronavirus positive cases reached 8,504 with 289 deaths. The country’s trajectory is reportedly  steeper than most Asian peers, such as Singapore, Japan, and Indonesia. Incidences of new infections and deaths are also rising faster. The report also highlighted a possible link between number of tests conducted and the number of confirmed cases across the States. The aggregated impact of Covid19 outbreak has created an unprecedented health, social and economic calamity, changing everybody’s life – now and beyond.

However, going by Prime Minister Modi’s announcement on March 24, 2020, the national lockdown to contain the pandemic should continue till April 14, 2020. But, the above scenario is creating a huge dilemma within almost all Coronavirus crisis management leadership in the States, with the final decision resting upon the Prime Minister of India. Meanwhile, on April 09, 2020, Odisha government decided to extend the lockdown until April 30, followed by Punjab, Maharashtra, Karnataka and Telengana on April 11, 2020. However, all will get to know India’s decision in this regard for the rest of India, as you read this piece today.

The top leaders of Asia, Europe and American continents are handling the grave situation differently, with a varying degree of success, so far. Everybody is watching different world leaders in action – each trying hard to gain control over the unprecedented crisis, making it an acid test for excellence in Crisis Leadership.

Three different types of needs for the country:

As I see, three specific types of needs of three specific classes of people in the social milieu, are emerging in India:

  • Only need is to save life from the disease, with not much problem in procuring other essential requirements – having enough wherewithal to pull through the critical period, better than most others.
  • Strong need exists to save life, but facing tough challenges in arranging for essential needs for daily living.
  • Need to save life, but feel desperate for the means of livelihood – to protect family and defendants from hunger, in a seemingly uncertain future.

In the current situation, while trying to contain the spread of pandemic effectively, the sufferings of especially, the second and third group, as stated above, also need to be addressed, ‘and this is much aided by a participatory democracy.’

An acid test for crisis leadership at the top:

The situation isn’t just a war against Covid19, but much beyond that. The Nobel Laureate Professor Amartya Sen at Harvard University  explained the situation so well in an article, published on April 08, 2020. He lucidly illustrated, that the needs of people in a natural calamity, such as Coronavirus caused a pandemic, are different from a conventional war – against an enemy country. Desirable leadership qualities are also significantly different.

As Professor Sen wrote, while managing a crisis situation during a conventional war, ‘a leader can use top-down power to order everyone to do what the leader wants – with no need for consultation.’ But, managing a crisis during a natural calamity, a leader should demonstrate skills for a ‘participatory governance and alert public discussion.’ Listening to public discussion makes the top leadership understand what needs to be done by the policy makers.

Another paper, titled “Steering Through the Storm,” published in the ‘People + Strategy’, also reiterated the same with different words. It emphasized, “during a crisis, like natural calamity, leaders should engage actively with their constituents whenever possible, distinguishing critical issues from less pressing needs, communicating risks, and maintaining readiness. Throughout the crisis, leaders should remain accessible and open to new sources of information, and take care of their own needs when necessary and appropriate.”

How different countries are demonstrating crisis leadership:

Like other countries, crisis leadership is now clearly visible even in India – right from 1 day ‘people’s curfew’, to the announcement of 21-day national lockdown for Covid19 outbreak. An interesting article, published in Forbes on March 10, 2020, deliberated on what China, Italy and the United States teach us about crisis leadership. These examples give a sense of how different countries, facing similar but country-specific problems with Covid19, reacted with remarkable ‘different approaches and results.’ I am paraphrasing below some recent illustrations on crisis leadership, as captured in the above paper:

China: China was the first country to face this calamity beginning in Wuhan of the Hubei province. With command and control leadership and decisive action China was able to immediately to garner and consolidate all its resources for an aggressive response. The World Health Organization called it as, “perhaps the most ambitious, agile and aggressive disease containment effort in history.” This includes closing down manufacturing sectors, sharing information widely, executing mass testing and quarantining millions of people. The Chinese government made the decision to absorb a significant economic cost to contain COVID-19 rather than potentially lose control and the result was effective - the number of new cases has steadily decreased in weeks’ time.

However, the downside of this type of leadership is the possible erosion of trust in the system. As the Atlantic documented, local Chinese officials reported the Covid19 outbreak to the federal government weeks after it began. They also understated the extent of the disease spread, until whistle-blowers stepped forward – and were subsequently punished. This delay probably cost China valuable time in containing the initial outbreak.

This demonstrates, under a command and control ‘crisis leadership’, when people are afraid to tell the truth and discouraged from speaking up, critical information may not reach leadership, until the problem intensifies, the paper added. That said, whether the COVID19 outbreak may have been contained earlier under different leadership conditions, cannot be concluded for sure, at least, in this case. However, official data release now shows more than doubling of new Coronavirus cases to 99 in Mainland China, on April 11, 2020. Moreover, newly reported asymptomatic Coronavirus cases also nearly doubled to 63 on the same day. Hence, the fire has still not been doused. The crisis lingers.

Italy: The catastrophic impact of Covid19 in Italy, helps identify some avoidable areas in ‘crisis leadership’. With rapidly changing and inconsistent messaging, the leaders possibly created panic and distrust among people of all kinds. The top leadership seems to have underestimated the potential spread of the virus, and was not acting in coordination with various groups and stakeholders to contain it, initially.

It happened, despite Italy is a democratic country, unlike China. But, the country, apparently, did not comply with the robust and critical ‘crisis leadership’ norm of fact-based ‘participatory governance and alert public discussion’, as discussed above. This reconfirms that ‘crisis leadership’ must be very careful in saying something they will end up contradicting later, while handling, especially a social calamity, like Covid19 outbreak.

The United States: With the fire of Covid19 outbreak spreading fast in the United States, one finds again, some basics of crisis management norms were missing in the top leadership of the oldest and a robust democracy of the world. Instead, President Trump demonstrated ‘a tendency to rely heavily on his inner circle rather than subject matter experts and to state opinions as facts.’ The President also contradicted experts on his own task force attempting to educate the public, most notably by consistently overstating the scientifically acknowledged timeline to create a vaccine and the preventive medicine combo. He also questioned the reported fatality rate of the virus.

This type of ‘crisis leadership’ is likely to fail in inspiring trust and confidence with the masses, the article concluded. This is evidenced by the current status of the country. The lethal firepower of Covid19 is still hitting the United States very hard, against all its might to fight the invisible enemy garnering all its resources and possibly taking more lives than what it lost, as on date, while fighting all its wars. As on April 11, 2020, the death toll from Coronavirus in the United States eclipsed Italy’s for the highest in the world, surpassing 20,000 marks.

Now let me focus on India, with my own assessment about the ‘crisis leadership’ while responding to this crisis, of course, initially.

India:

To get a perspective of Covid19 spread in South Asia on a relative yardstick, let’s look at the following Government released figures, as quoted in the Reuters report on April 08, 2020:

Country Ind Pak Afghan Sri Lanka Bangladesh Maldives Nepal Bhutan
Cases 5274 4072 444 189 218 19 9 5
Death 149 58 14 7 20 0 0 0

On April 11, 2020, the World Bank estimated, the ‘worst economic slump in South Asia in 40 years.’ Further, India, Bangladesh, Pakistan, Afghanistan, Sri Lanka and other three smaller nations, with 1.8 billion people and thickly populated cities, although have so far reported relatively few Coronavirus cases, could be the next hotspots for Covid19.

With this, let us look at the Covid19 narrative being unfolded in India, so far. In a lighter vein, following the interesting events with ‘sound’ and ‘light’, the ‘camera’ of time has indeed captured a commendable display of high quality ‘crisis leadership’ in India. Especially, under the given circumstances prevailing at that juncture. The leadership approach fits so well into one of the most critical requirements of crisis management – ‘participatory governance and alert public discussion.’

Even, some seemingly pointless events for some, at the end of the day, did raise morale of many in the fight against Covid19 outbreak, besides their level of participation and involvement in this crisis. Whether or not it is purely due to the personal charisma of the Prime Minister and his huge followings, also doesn’t matter much, as the point is, what really happened, instead of why it happened.

Besides, right from the declaration of ‘Peoples Curfew’ of March 22, 2020 to 21-day national lockdown, the Prime Minister has involved the State Chief Ministers, but also the leaders of opposition parties. Indian Council of Medical Research (ICMR) is also visible in the forefront. The net result is the support that the Prime Minster is getting from all, despite hardship – an epitome of ‘crisis leadership,’ as on date.

Thus, the beginning has been laudable, especially when India had no option but to enforce a lockdown, in one form or the other, without having enough testing kits, Personal Protective Equipment (PPE) for healthcare manpower and required health care infrastructure for quarantine or isolation of people. Let me explain this point with a very recent example.

According to a recent report, Covid19 test guidelines presumed that most patients in India acquired the virus from their travels abroad, or from someone who travelled abroad. Accordingly, with a limited number of kits, tests were conducted to zero in on these patients, isolating and quarantining them, to curb the spread of the virus. very focused with lesser requirements of the testing kits.

However, the data compiled by ICMR from random Coronavirus tests on patients with severe respiratory diseases, indicate that 38 percent of Covid19 patients with no travel or contact history have contracted the virus. On April 10, 2020, the Government said that the testing has now been increased to 16000 from earlier 5000-6000 people per day. This raises the vital question: has Covid19 outbreak in India has progressed or progressing from stage 2 to stage 3 of the outbreak, or has the community spread of the disease begun, the last and final stage being stage 4 – the scary virtually uncontrolled Coronavirus outbreak? Alarmingly, as has been widely reported, even on April 12, 2020: ‘Coronavirus in India: Several targets missed, still no sign of rapid testing kits.’ Currently, ‘India ranks extremely low in the Coronavirus-hit countries list based on the number of tests done per million population.’

Thus, the declaration of 21-day national lockdown on March 24, 2020, at the early stage of the Coronavirus outbreak in India was an unprecedented decision. Besides, containing the rapid disease spread, it gave India a small time-space to prepare itself – with more testing kits, Personal Protective Equipment (PPE) for healthcare manpower and adequate number of high-quality – isolation, quarantine and treatment facilities, equipped the disease specific requirements, such as, ventilators.

No matter what, the decision for a 21-day nationwide complete lockdown, giving priority to life over livelihood was a tough call to take for any leader. It indeed was a part of the critical test for excellence in ‘crisis leadership,’ at that point of time.

Conclusion:

Be that as it may, as the saying goes ‘proof of the pudding is in the eating,’ the acid test for excellence in ‘crisis leadership’, obviously, will be based on the quality of outcomes and the time it will take. This will include multiple key factors, such as, the speed of health, social and economic turnaround of a country, which is sustainable. Nevertheless, the crisis is far from being over – anywhere in the world, just yet, and the jury is still out.

By: Tapan J. Ray  

Disclaimer: The views/opinions expressed in this article are entirely my own, written in my individual and personal capacity. I do not represent any other person or organization for this opinion.

 

Multifaceted Coronavirus Narrative Raises Multiple Questions

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Last night, amid the national lockdown, many people followed Prime Minister Modi’s video message, broadcasted on April 03 at 9 am for all, ‘to challenge the darkness of Coronavirus together – with a Diya, candle, torch or flashlight, at 9 pm for 9 minutes, from their respective balconies.’ That was the 12th day of 21-day lockdown, when the deadly microbe – Covid19 infected, tested and detected cases climbed to 3,577 in the country, with the death toll rising to 83. This is against 564 - the total number of confirmed cases in India when the lockdown commenced on March 24, 2020.

With all this, a mind-boggling narrative is developing at an accelerating pace. It’s not just about the rogue microbe – rampaging the world hunting for its prey. But also pans over multiple dimensions of its fallout, impacting virtually everything, for all. People of all sections of the society are participating, deliberating or debating on this issue, as the invisible camera of destiny rolls on. Unprecedented!

That’s the real world where, despite fear of an unknown future, most people prefer freedom of expression while playing a constructive role in containing the menace, collectively. We are witnessing a similar scenario – the world over. But, more in the democratic nations. Relatively enlightened citizens will always want to participate in this emerging chronicle, shaping the overall narrative and help sharpening the nations Covid19 policy further – instead of being passive onlookers.

Meanwhile, the objective of maintaining physical distancing during 21-day national lockdown period and beyond must be achieved, regardless of any public discord on its mechanics. This has to happen, primarily because of the TINA factor. Likewise, it’s also a prerequisite that the lockdown is handled efficiently, with meticulous advance planning, deft and dignified handling of any situation, by all and for all. That said, the good news is, newer scientific, evidence-based data are revealing more actionable pathways, in this multifaceted narrative.

A multifaceted narrative raises multiple questions:

As I wrote above, Covid19 narrative is multifaceted and not just one dimensional. It’s true beyond doubt: ‘If there is life, there is the world.’ But, that has to be a life with dignity, a life that help protect families and facilitates contributing to the nation, in different ways – enabling a scope of fulfillment of all.

In this article, I shall, explore some important facets of the evolving narrative on the Covid19 outbreak to drive home this point. In that process some very valid questions, as raised by many, also deserve to be addressed. Some of these include:

  • Covid19 is a war like situation where no questions are asked about the strategic details of a warfare, why the same is not being followed today? In a war some collateral damages are inevitable, why so much of noises now?
  • Why has Covid19 created a general panic with stigma attached to it?  
  • Panic is avoidable, but is the threat real. If so, why?
  • Why people violating national lockdown by migrating from the job location to respective hometowns – increasing the risk of the disease spread, must be brought to their senses mostly through the harsh measures?
  • In the absence of any vaccine or an effective curative drug, why all decisions of policymakers must be blindly accepted by all, during national lockdown and maybe beyond, as if there is ‘not to reason why, but to do or die?’

Let me now explore each of these questions.

A war like situation?

No doubt Covid19 is a war like situation, but with some striking dissimilarities between a conventional war and this war. A conventional war is fought by a well-trained and well-armed defense forces with already developed a gamut, against a known and visible enemy nation.

Whereas, the war against Covid19 is against an invisible and unknown microbe’s sudden attack, being fought in India by a limited army of health care professionals and workers. They fight this war, mostly without adequate or no battle gear, like Personal Protective Equipment (PPE), testing kits and ventilators, supported by a fragile health care infrastructure.

Moreover, in the conventional warfare, the type of advance information and intelligence that the Governments usually possess against the enemy nations, can’t be matched by any private domain experts.

Whereas, Covid 19 still being a lesser known entity to medical scientists, as on date, the remedial measures are still evolving. Only scientific-evidence-based data can create actionable pathways for combat, spearheaded by the W.H.O. Thus, most people expect the nation to comply with, at least, the current W.H.O guidelines for health-safety of the population.

Further, in the cyberspace, several latest and highly credible research data are available for all. These are being well-covered by the global media as a part of the narrative. Thus, unlike conventional warfare, external experts may know as much, if not even more than the Government on Covid19.

Some avoidable show-stoppers:

There are several such avoidable show-stoppers. For example, when one reads news like, ‘Delhi Government Hospital Shut As Doctor Tests Positive For Coronavirus,’ or something like, ‘Indian doctors fight Coronavirus with raincoats, helmets amid lack of equipment,’ alongside a jaw-dropping one, ‘India Sends COVID-19 Protective Gear To Serbia Amid Huge Shortage At Home,’ chaos in the narrative takes place.

In the tough fight against Covid19 menace, these much avoidable fallout may be construed as show-stoppers, if not counterproductive. Many may advocate to pass a gag order against revelation of such difficult to understand developments, and keep those beyond any public discussion. Instead, why not order a transparent enquiry by independent experts to find facts – holding concerned people accountable?

Why has the disease created so much of panic with stigma attached to it?

This is intriguing because, according to the W.H.O – China Joint Mission report on COVID-19, around 80 percent of the 55924 patients with laboratory-confirmed COVID-19 in China, had mild-to-moderate disease. This includes both non- pneumonia and pneumonia cases. While 13·8 percent developed severe disease, and 6·1 percent developed to a critical stage requiring intensive care.

Moreover, The Lancet paper of March 30, 2020 also highlighted, in all laboratory confirmed and clinically diagnosed cases from mainland China estimated case fatality ratio was of 3·67 percent. However, after demographic adjustment and under-ascertainment, the best estimate of the case fatality ratio in China was found to be of 1·38 percent, with substantially higher ratios in older age groups – 0·32 percent in those aged below 60 years versus 6·4 percent in those aged 60 years or more, up to 13·4 percent in those aged 80 years or older. Estimates of the case fatality ratio from international cases stratified by age were consistent with those from China, the paper underscored.

Even the Health Minister of India has emphasized, ‘around 80-85 percent of cases are likely to be mild.’ He also acknowledged: “My biggest challenge is to ensure that affected people are treated with compassion, and not stigmatized. This is also applicable for the health care workforce, which is working hard to counter this epidemic. It is through concerted, community-owned efforts, supported by the policies put in place by the government that we can contain this disease.” This subject, surely, needs to be debated by all, and effectively resolved.

Panic is avoidable, but does a real threat exist with Covid19?

As The Lancet paper of March 30, 2020 cautions by saying - although the case fatality ratio for COVID-19 is lower than some of the crude estimates made so far, with its rapid geographical spread observed to date, ‘COVID-19 represents a major global health threat in the coming weeks and months. Our estimate of the proportion of infected individuals requiring hospitalization, when combined with likely infection attack rates (around 50–80 percent), show that even the most advanced healthcare systems are likely to be overwhelmed. These estimates are therefore crucial to enable countries around the world to best prepare as the global pandemic continues to unfold.’ This facet of Covid19 also requires to be a part of the evolving narrative to mitigate the threat, collectively, with a robust and well thought out Plan A, Plan B, Plan C….

Violation of lockdown increases the risk manifold, but… 

There isn’t a shade of doubt even on this count, in any responsible citizen. Besides individual violation, recently a huge exodus of migrant laborer’s ignoring the lockdown raised the level of risk for others. This exodus should have been stopped at the very start, by better planning and with empathy and dignity by the law enforcing authorities, as many believe. Curiously, even the current Chief Justice of India (CJI) commented, on March 30, 2020: “The fear and the panic over the Coronavirus pandemic is bigger that the virus itself,” during a hearing on the exodus of migrant laborers from workplace to their respective hometowns, due to Covid19 lockdown.

To mitigate the risk, the CJI advised the Government to ensure calming down ‘the fear of migrants about their future, after being abruptly left without jobs or homes because of the 21-day lockdown to prevent the spread of Coronavirus.’ The Court felt, ‘the panic will destroy more lives than the virus.’ Thus, the Government should “ensure trained counsellors and community leaders of all faiths visit relief camps and prevent panic.”

The CJI also directed the Government to take care of food, shelter, nourishment and medical aid of the migrants who have been stopped. This appears to be the desirable pathway of preventing the migrant exodus, causing greater risk to people, requiring better planning, deft situation management with empathy and dignity, by the law enforcing authorities. However, individual violations, if any, can be addressed by intimately involving the civil society, against any possibility of the disease spread.

Whatever decision the policy makers take, must be blindly accepted by all:

In this area, all must first follow what the Government expects us to do. Maintaining strict compliance with such requirements. But, some people do ask, is it in total conformance with the steps W.H.O recommends following? At the March 30, 2020 issue of the Financial Times reported, the W.H.O’s health emergency program has outlined four factors that might contribute to the differing mortality rates in Covid19 outbreak:

  • Who becomes infected?
  • What stage the epidemic has reached in a country?
  • How much testing a country is doing?
  • How well different health care systems are coping?

Many members of the civil society are also keen to know these facts, and may want to seek clarification, if a gap exists anywhere. After all, Covid19 outbreak has brought to the fore, an unprecedented future uncertainty of unknown duration, involving not just life, but a sustainable livelihood and a dignified living in the future, for a very large global population, including India.

Conclusion:

There seems to be a dose of chaos in an otherwise reasonably controlled scenario. One option of looking at it as a pure law and order issue, which needs to be brought to order only with a heavy hand. The second option is to accept it as a golden opportunity to take all on board, by clearly explaining what people want to know – with reasons, patience, persuasion, empathy and compassion, as is happening in many countries.  Of course, without compromising on the urgency of the situation. This is a challenging task, but a sustainable one. Overcoming it successfully, will possibly be the acid test of true leadership, at all levels. However, the slowly unfolding narrative on the ground, doesn’t appear to be quite in sync with the second option.

In the largest democracy of the world, people want to get involved in a meaningful discussion on Covid19 crisis, collectively – based on evidence-based scientific data. Then, it’s up to the policy makers to decide what is right for the country and in which way to go. In tandem, fast evolving, multifaceted Coronavirus narrative, I reckon, will keep raising multiple questions.

As the disease spreads, the pathways of combating it decisively, is being charted by different experts, led by the World Health Organization (WHO). This is being widely covered by the mainstream global media, even in the din of a cacophony. Nonetheless, it is generally believed that a true relief will come, only after a vaccine is developed and made available and accessible to all sections of the world. Till such time a ‘hide and seek’ game, as it were, is expected to continue.

By: Tapan J. Ray  

Disclaimer: The views/opinions expressed in this article are entirely my own, written in my individual and personal capacity. I do not represent any other person or organization for this opinion.

 

What Pays More: Creating ‘Innovative ‘Customer Experience’ Or ‘Innovative Drugs’?

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More innovative a drug is, the better is its business success rate. This was the general perception of around 92 percent pharma professionals in the past three years. Whereas the fact is: ‘Having the best product doesn’t guarantee sales anymore’. This was established by a research study of the ‘Bain & Company’ - covering multiple therapeutic areas, and was published on October 14, 2019.

It showed, when physicians prescribe a drug – its efficacy, safety and side-effect profile initially account for only 50 percent to 60 percent of the physician’s choice, with a declining trend over time. Interestingly, the other 40 percent to 50 percent of it, is based on a range of ‘physician and patient experience factors’, which pharma players need to target in innovative ways to differentiate their brands.

Many pharma companies are now experiencing the harsh reality that more innovative drugs, backed by traditional sales and marketing support are not yielding desirable financial returns. Head scratching has already started among astute pharma professionals to understand its reason for remedial measures. Thus, the number of executives who agreed with the above ‘Bain & Co’ study that: ‘Having the best product doesn’t guarantee sales anymore,’ increased to almost fourfold – from 8 percent to 28 percent in the next three years.

Thus, in this article, I shall explore whether innovation in creating a ‘unique patient experience’ during a disease treatment process, is as important, if not more than a ‘new drug innovation’. Curiously, high failure rate of most pharma players to innovate in this area, isn’t discussed as much as high failure rates in the development of innovative new drugs.

‘Customer service’ innovation – high failure rate – falling short of expectations:

Again, another article - ‘How Agile Is Powering Healthcare Innovation,’ published by ‘Bain & Company’ on June 20, 2019, brought out some interesting points related to this area. Let me quote a few of which as follows:

  • 65 percent of ‘customer-service innovation’ fall short of expectations of the target group.
  • The number of health care executives recognizing the need to respond quickly to changing customer-needs, has increased from 38 percent in the past three years to 60 percent for the next 3 years. But, most of them ‘lack the methodology, and even the language to implement it in practice.’
  • ‘Having the best product doesn’t guarantee sales anymore.’ Thus, healthcare companies face growing pressure to innovate in providing unique ‘customer experience’.
  • The critical point to note, customer needs evolve continuously, and leading companies respond rapidly with innovative new solutions catering to changing market demand.

As the core purpose of working for ‘customer-service innovation’ is linked with creating ‘brand loyalty’, let’s have a quick recap on ‘brand loyalty’ really means for pharmaceutical products, in today’s context.

‘Brand loyalty’ for pharmaceutical products in modern times:

There are many similar definitions of ‘brand loyalty’ for a pharmaceutical product. The research article – ‘Brand Loyalty as a Strategy for the Competition with Generic Drugs: Physicians Perspective,’ published in the Journal of Developing Drugs, on August 30, 2016, defined ‘brand loyalty,’ and articulated its advantages.‘ I am paraphrasing a few of which, as below:

  • The extent of the faithfulness to a particular brand, which is a major indicator of a long-term financial performance of companies.
  • The main advantages of brand loyalty can be defined as greater sales and revenue, a substantial entry barrier to competitors, increase in a company’s ability to respond to competitive threats and lower consumer price sensitivity.
  • ‘Brand loyalty’ can protect against price competition, including branded generics, as it gives confidence to physicians on the perceived effectiveness and safety of a brand – which they usually won’t be willing to compromise with for lower prices.

This brings us to a key question. Are traditional pharma methods of creating ‘brand loyalty’ getting replaced by the key consideration of creating a ‘unique customer experience’?

Creating ‘brand loyalty’ through ‘patient loyalty’ – a new equation:

It’s a fact today that traditional pharma methods of creating ‘brand loyalty’ is getting replaced by the key consideration of creating a ‘unique customer experience.’ This, in turn, is increasing the need of building ‘patient loyalty’, both for a pharma brand, as well as respective companies offering these brands. This is a new equation, where offering a ‘unique treatment experience’ to patients assumes a critical role more than ever before. This needs to be clearly understood by today’s pharma marketer, without any ambiguity.

In traditional pharma marketing, physicians remain, virtually, the sole focus of the branding exercise, as they appear to be the only decision makers of writing a brand prescription. Patients, in general, hardly used to have any role to play in that process. In this scenario, brand loyalty for the doctors – assuming the absence of any malpractices, is primarily driven by the following three much known factors:

  • Physicians’ unprejudiced buying-in a brand’s value offerings
  • Evaluation of opinion leaders and the doctors’ professional counterparts,
  • Quality of disease treatment outcomes.

Nevertheless, before getting into this area, let’s have a quick look at the primary drivers that pharma marketers have been using to boost financial performance of a brand.

Traditional sales boosters of a pharma brand:

The primary drivers that pharma marketers have been using to boost financial performance of a brand can broadly be classified as follows:

  • Multiple ways are followed to make important doctors write more prescriptions,
  • Increase the drug price, whenever an opportunity arises.

These factors still remain important, but aren’t just enough to deliver sustainable performance over a period of time. Thus, a new dimension needs to be added to it.

Add a new dimension to create brand and corporate loyalty:

With the emergence of increasingly more informed and demanding patients, there is a need to create a ‘loyal patient population’, by offering them primarily a ‘unique treatment experience’. And this is the new dimension.

For this purpose, off-the cuff approaches or strategies based on mere gut-feelings are unlikely to work. As I indicated in one of my articles, marketers need to acquire deep insights on their customers to make sales and marketing decisions more informed, than what it is today. Currently available state of the art technology can be a great enabler to facilitate this process.

This is easier said than done, because answering the question – how does a drug company create ‘brand loyalty’, is indeed a tough call. Nonetheless, many different industries have realized, since long, that offering a ‘unique customer experience’, is critical to create a pool of ‘loyal customers’.

I also had written earlier, pharma is still a late learner in accepting various new normal, in a holistic way. Accepting this reality, a sharp focus on creating ‘brand loyal doctors’ in various innovative ways, I reckon, will serve this purpose well. It’s only recently, a few companies have started working to offer such ‘experience’ to patients in the disease treatment process - end-to-end. Ironically, a large majority of them prefer to talk about it more than actually translating the same into reality.

Benefits of ‘brand loyalty’ through ‘unique customer experience’:

There are several advantages of building pharma ‘brand loyalty’ by offering ‘unique customer experience, without diluting the focus on ‘increasing prescription generation through doctors’. The benefits, I reckon, include, both new – innovative products and also branded generics. Let me give below one example of each:

  • Innovative new-products – positive word-of-mouth promotion: Satisfied patients having ‘unique end-to-end treatment experience’ with a new, innovative brand, are very likely to share it with others. This may be done by using different modes of communication, including various social-media platforms. This, in turn, may help both – add to take-off speed – post launch and create a snowballing impact on the brand adoption thereafter.
  • Branded generics – extend the product life cycle and increase growth: Patients who are loyal to a particular branded version of a generic molecule, are quite likely to refuse any change to a cheaper equivalent, even if recommended by the physician. Moreover, they will advocate for this brand to others, using different communication platforms, as indicated above. Continuation of this process will extend the life cycle of the branded-generic, with increasing growth and market share.

Conclusion:

Now, it’s time to get back to what we started with - What pays more: Creating ‘Innovative ‘Customer Experience’ Or ‘Innovative Drug?’ From the above perspective, it emerges that bringing innovative product to markets is, of course important. However, to ensure its sustainable financial success, other innovations, such as creating ‘a unique end-to-end patient experience’ with the brand, in all probability, would weigh more. This is an area which did not receive much attention for a long time, moving beyond the creation of increasing numbers of ‘brand loyal’ doctors, for business success.

Today, increasing consumerism in the health care space, besides pricing pressure, unfavorable perception and sinking image of the industry, is creating a strong headwind – impeding desirable growth of many pharma players. Such a challenging business scenario has prompted a few of them to innovate in designing a differentiated ‘customer experience’ – in a true sense.

Although, a large number of companies are talking about it, most are mere lip-services – a ground-swell in this area is yet to take place. The industry priority, in general, still weighs heavily in developing innovative products, and creating ‘brand loyal’ doctors, rather than cultivating ‘brand loyal patients’, alongside.

By: Tapan J. Ray

Disclaimer: The views/opinions expressed in this article are entirely my own, written in my individual and personal capacity. I do not represent any other person or organization for this opinion.

Is Pharma Industry A Late Learner, Always?

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Several upcoming concepts in the pharmaceutical industry are becoming buzzwords today. But, most of these were recommended by stalwarts several decades ago. Interestingly, the prevailing scenario is no different, even related to wide-scale adoption of a number of cutting-edge technologies, to squarely face the ongoing challenge of changing market dynamics. Various studies point out that other industries are making transformative use of these – to be on the same page with their customers, much faster.

Pharma is considered to be a late entrant in the digital space, too. It’s still not quite clear to many, the extent by which ‘Digitalization’ is transforming the way pharma industry functions – aiming at unleashing huge opportunities for value creation – from supply chain to manufacturing – right up to creating a unique customer experience. As this subject was well deliberated in the August 2016 article on McKinsey Digital, I am not going to delve into that area today.

Therefore, the question that comes up: Is pharma industry, in general, a late learner – always, to be in sync with its contemporary customers? For exploring this point, I shall focus mainly on four areas of current hypes in the pharma business, namely - ‘patient empowerment’, ‘patient-centricity’, ‘customer experience’ and ‘E-Patients’.

In this article, I shall dwell on this subject, ferreting out some critical recent findings on the relevance of these not so recent concepts in today’s perspective. Let me start by diving deep into the time capsule.

How old are these concepts?

Industry watchers may know that these are not new concepts, in any way. The relevance of ‘patient empowerment’, ‘patient-centricity’, ‘customer experience’ and ‘E-Patients’ in the drug industry has not unfolded today, neither are these new ideas. The American medical doctor - Thomas William ”Tom” Ferguson (July 8, 1943 – April 14, 2006) was an early advocate for ‘patient empowerment’.

Since 1975: “He urged patients to educate themselves and share knowledge with one another and urged doctors to collaborate with patients rather than command them. Predicting the Internet’s potential for disseminating medical information long before it became a familiar conduit, he was an early proponent of its use, terming laymen who did so – ‘E-Patients‘.”  

Technology follows a concept and not vice versa:

With ‘E-Patient’ terminology, Dr. Thomas Ferguson talked about empowered, engaged, equipped and enabled patients. I reckon, even after close to 45 years, most of the drug industry, is still not quite there – ‘Digitalization’ initiatives notwithstanding. This is because, technology follows a concept and not vice versa.

Why it’s so?

I reckon, this is primarily because, many stakeholders often don’t pay much importance to a critical fact, which is: ‘Patient expectations and needs can differ considerably from the aims and objectives of health care providers, at both the policy and delivery levels,’ and also by many drug companies. Still, most of these entities are yet to lap up this concept.

Is reviving focus on ‘Patient Centricity’ a realistic proposition today?

Several studies in this area have concluded, to be accepted by patients, the patient experience should be the key driver for the development of solutions.’ These include, medicines, devices, information, support programs and even digital apps. Among many others, one such study was published on March 28, 2017, in the SAGE Journals, titled, ‘Patient Centricity and Pharmaceutical Companies: Is It Feasible?’

The basic question of its feasibility would prompt: ‘Would this approach help pharma players to make enough profit with the drugs?’ While addressing this query, the researchers put across the following points that need to be seriously reflected on:

  • Profit is necessary. But, how drug companies make and use business ‘profit’ is more important for long-term business sustainability.
  • It requires a clear vision at the top of creating and delivering ‘customer value’ as patients will perceive, followed by a robust assertion of ‘Patient Centricity’ across the business domains.
  • This will help break out of the cycle of “recover costs of R&D – make a profit – invest in new drugs – make more profit.” The new ball game will be – profit through customer satisfaction – invest in new drugs for greater ‘customer value and more customer satisfaction’
  • Such commitments, in turn, will help generate not just reasonable profit, but credibility with external stakeholders – such as, patients, regulators, media, etc. – creating an invaluable reputation for the organization, as a future growth booster.

Since old practices have continued for very long, virtually unchanged, a legacy factor has now crept into the system, mostly as a retarding force.

A legacy issue to overcome:

As the above research article underscores: ‘Historically, the pharmaceutical industry’s role has been to develop the science and medicines for prevention or treatment of disease.’ Whereas, ‘Patient Centricity’ involves patients as stakeholders in this scientific process. It calls for an innovative mindset, whereby ‘the industry is challenged to engage and collaborate with patients when deciding the best course of action.’ This need is now palpable within the industry, at the long last. 

Palpable needs for a new focus on designing ‘healthcare solutions’:

With the shift in the environment around the industry and its stakeholders, including patients, are feeling the need to ferret out some old classic concepts for a new focus in designing various ‘healthcare solutions.’ For this purpose, as the above research article reiterated, a better understanding of ‘patient experience’ at critical points, in the course of the diagnosis and treatment of the disease, would help designing more effective ‘health care solutions’ for better patient outcomes.

The commercial necessity for better patient outcomes, merits ‘Patient Centricity’ at the core of the pharma business model, which, in turn, calls for a shift in the cultural mindset within the pharmaceutical industry. Such a shift would involve, among others:

  • Redefining the core strategy, organizational structure, processes and capabilities to focus on transparency and value creation for the patient.
  • A change from a disease-centered to a patient-centered strategy, and from a product-led to a patient-led development process.
  • Listening to and partnering with patients, and understanding the patient perspective, rather than simply inserting patient views into the established process.

Therefore, ‘patient-centric’ initiatives of any company should begin with the basic question: how can the company make a difference for patients?

The new realization: Compete better to win, neutralizing healthcare consumerism:

To better compete and win even in the midst of evolving healthcare consumerism, instead of adding fuel to it around the world, including India, a new book – ‘Making the Healthcare Shift: The Transformation to Consumer-Centricity,’ brings some contemporary ideas where, again, many old ideas seems to have been tested with a new perspective.

Interestingly, the content of this book is based on over 60 executive interviews with the biggest names in healthcare and a quantitative research study. Some of these names include leading academic institutions, such as, the Mayo Clinic, USCF Medical Center; big drug companies like Pfizer, Lilly and Novartis. The book reveals, while healthcare organizations have recognized the need to change to ‘Patient Centricity, they often don’t know where or how to begin.

To help healthcare organizations reinvent how even traditional pharma players engage with consumers in the new paradigm, the authors identify five shifts that pharma players can make to better compete and win in this evolving landscape of healthcare consumerism. 

Need to ‘reinvent the wheel’, is more than ever before!

To ascertain the above point, I shall paraphrase just a few – ‘Patient-Centric’ and ‘Customer Experience’ related areas of the book along with my own views to help you to come to your own logical conclusion:

  • To provide a holistic disease treatment solution, keeping the patients engaged along the entire journey in the disease treatment process, pharma players should bring ‘consumer experience’ at the core of the business model. As I also deliberated in this blog that: ‘Enhancing End-To-End Customer Experience’ is, therefore, considered by many astute pharma marketers, as a vital ingredient of pharma brand building exercise. In that article, I articulated, such initiatives should cover, all the ‘’touchpoints’ and ‘episodes.’ Where ‘touchpoints’ are spots of contact or interaction and ‘episodes’ focus on end-to-end design of a specific customer-need for an organization. Aligning management and the front line around the customer experience, is critical.
  • As things stand today, the entire journey through the disease diagnosis and treatment process, in the current healthcare ecosystem, remains fragmented. Mostly because, it involves many ‘touchpoints’ and ‘episodes,’ comprising of different health care entities. Providers’ inefficiencies, of various types, encountered by patients at different points of this journey often lead to their frustration, causing an unpleasant ‘customer experience.’ To achieve this objective, by effectively addressing the aforesaid common denominator for all – ‘Patient-Centricity,’ is of paramount importance. This entails, as stated before, integrated measures for listening to and partnering with patients, alongside, placing patients’ well-being at the core of all healthcare business initiatives. From this perspective, ‘patient-centricity’ based on customer insights,represents a holistic approach to provide the disease management solutions.
  • With rapid advancement in medical science, culminating into several breakthrough innovations, the world has stepped into a new era of disease treatment solution. Increasingly, ‘one size fits all’ type of population-centric treatment, is giving away a sizeable space for a new ‘patient-centric’ variety of the same. Moving towards this direction would necessitate pharma players, along with all health care organizations to acquire a deep insight on patients. The acquired insights must be based on in-depth analysis of a robust and contemporary sets of data, including demography, attitude towards health, treatment needs and preferred options available to the targeted audience.

This brings me back to where I started from. Dr. Thomas William ”Tom” Ferguson and maybe several others, as well, had recommended similar approaches over four and a half decade ago. We did not learn it then. But, while fighting against all odds, as the industry has been facing over some time, some companies are feeling the need of learning it now. Better late than never!

Conclusion:

It has been universally accepted that market dynamics keep changing in all industries, may be faster in some than others. Looking back, one can sense similar ongoing changes both within the pharma industry and the business and social and cultural environments outside, especially related to its stakeholders. When faster, proactive changes take place within the industry than outside, it delights the customers. Similarly, faster changes in the outside environment that industry fails to keep pace with – deliberately or otherwise, will invite strong headwind impeding growth of the business and even denting its reputation. Although, the former one is desirable, the latter prevails in most areas of pharma business. A Working Paper of the Harvard Business School wanted to understand ‘How do organizations learn?’ It found, among others:

  • Performance outcomes can be augmented, if one deliberately focuses on learning from experience accumulated in the past.
  • The competitive advantage of firms critically depends on the skills of individual contributors. Hence, the centrality of individual and organizational learning is a critical factor for competitiveness of any organization.

This brings us to the question, what is a learning organization. From many similar definitions of the same, let me quote the following one, as it is apt, simple and old enough for all to have learned: “A Learning Organization is the term given to a company that facilitates the learning of its members and continuously transforms itself.” (M. Pedler, J. Burgoyne and T. Boydell, 1997)

Keeping today’s deliberation in perspective, one may possibly conclude, quick individual learners, including the organizations, can offer better performance outcomes than late learners. As the pharma business is encountering a strong headwind for quite some time, it is up to the readers making out, what type of learner the industry, in general, is, and more importantly, why it is so?

By: Tapan J. Ray   

Disclaimer: The views/opinions expressed in this article are entirely my own, written in my individual and personal capacity. I do not represent any other person or organization for this opinion.

Honing Patient Outcomes With WHDs

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On November 01, 2019, San Francisco-based Fitbit, Inc. announced that it has entered into a definitive agreement to be acquired by Google LLC for approximately US$ 2.1 billion. Many believe, though, the value of Fitbit lies in the health data that its wearables capture for its large base of users.

According to the CEO of Fitbit, currently the Fitbit brand supports more than 28 million active users around the globe who rely on these wearable products ‘to live a healthier, more active life.’ With Google’s resources and global platform, Fitbit will be able to accelerate innovation in the wearables category, scale faster, and make health even more accessible to everyone, he added.

The article – ‘The Real Reason Google Is Buying Fitbit,’ published in the Time magazine on November 04, 2019 makes some interesting points, such as the following:

  • The fast-growing healthcare tech space could be worth US$24 billion by 2020, says an estimate from Statista.
  • Although, Google has been working on cardiovascular health, diabetes and more, it hasn’t been publicly pushing healthcare as a business proposition, just yet.
  • Whereas, Google’s rivals, most notably Apple, have embraced healthcare as the next big battleground in the tech world, attracted by the promises of big profits for those who can help simplify a byzantine healthcare system.

Nonetheless, the Fitbit acquisition would facilitate Google’s entry into the Wearable Health Devices (WHDs) market in a big way, alongside other big players, such as, Apple and Samsung.

Driven by the most likely scenario of increasing usage and usefulness of WHDs, several pharma players are sniffing huge underlying commercial opportunity in this space, alongside being demonstrably patient-centric. Thus, my today’ article will deliberate whether or not WHDs will be able to offer a cutting edge to innovative drug marketers, by continually honing patient outcomes. Let me initiate this discussion by fathoming the importance of WHDs in the fast transforming digital world.

The importance of WHDs in the digital world:

‘Mary Meeker‘s 2019 Internet Trends Report’ highlights, about 51 percent of the global population is now connected to the internet, with the majority of users based in China, India and the United States. However, global internet user growth has slowed down by 6 percent and it’s becoming increasingly harder to get the rest of the world online.

In this background, especially - ‘As patients become more involved in making decisions about their health care, research shows, the result is increased satisfaction and improved health outcomes.’Consequently, the report spotlights healthcare digitization where consumer adoption of digital health tools is increasing rapidly. Some of the top areas, in terms of their speed of adoption, were listed as follows:

  • Online Health Information
  • Online Provider Reviews
  • Mobile Tracking
  • Wearables
  • Live Video Telemedicine

This gives a sense of how fast the WHDs are gaining importance for the consumers. Interestingly, Intouch Group also points out that wearables are now being used more to manage a diagnosis rather than just fitness trackers. Adding further, it pointed out – ‘Apple’s ResearchKit is an example of what CEO Tim Cook calls the “democratization of healthcare,” in that it provides health data directly to consumers so they can manage their health.’

A recent study on the scope of wearables: 

The scope of WHDs was aptly corroborated in a recent article – ‘The Rise of Wearable Technology in Health Care,’ published in the JAMA Network Open on February 01, 2019. The paper concludes, the general principle of commercially available ubiquitous wearable computers bodes well for our future ability to measure, track, and understand patient physiological data and behavior both in the hospital and at home.

The ability to capture such data, then applying machine learning to get the evolving health trends and sending alerts to patient accordingly – nurses, and physicians are instantaneously getting empowered to deliver patient outcomes. The fact that the alert can come easily via the patients’ smartphones that a significant part of the global population now carries with them, leading to further democratization of health care.

The Economist  also predicted, by 2020 – 80 percent of the adult population of the world would have a smartphone in their pocket. Therefore, this development opens up an entirely new world of real-time data acquisition, monitoring, and intervention, the paper underscored.

Giving a relevant example, it highlighted: ‘On December 6, 2018, Apple rolled out a software upgrade that turns the Apple Watch Series 4 into a personal electrocardiogram.’ The researchers further added, while WHDs’ fidelity may not yet exactly match medical-grade monitors and devices, these are “good enough” coupled with around-the-clock capabilities, real-time data capture, storage, and analytics and seem likely to provide real value.

The opportunities with WHDs:

Both from the health and business perspectives, WHDs are opening new vistas of opportunities for all stakeholders in the healthcare space, such as, patients, doctors, care providers and also pharma companies. This was enunciated in several studies, such as one, titled ‘Wearable Health Devices – Vital Sign Monitoring, Systems and Technologies,’ published by Sensors (Basel, Switzerland) on July 25, 2018.

This paper also reiterated: ‘Wearable Health Devices (WHDs) are increasingly helping people to better monitor their health status both at an activity/fitness level for self-health tracking and at a medical level providing more data to clinicians with a potential for earlier diagnosis and guidance of treatment. The technology revolution in the miniaturization of electronic devices is enabling to design more reliable and adaptable wearables, contributing to a world-wide change in the health monitoring approach.’

Thus, a big excitement is currently palpable around the technology related to WHDs. Many more opportunities are expected to unfold for continuation of the ascending trend. With the entry of big global tech giants such as, Apple and now Google, besides scores of small startups, WHDs of many types have started entering into the healthcare, carrying a promise to improving outcomes and creating a unique patient experience in the disease treatment process.

Improves outcomes, creates a unique disease treatment experience:

Echoing many other experts in this area, I also believe that WHDs have covered a lot of ground by now – expanding its usage from fitness trackers to diagnosis of disease and then monitoring the progress both during and after treatment. Current usages of WHDs are mostly for non-infectious chronic diseases, such as diabetes, cardiovascular conditions, sleeping disorders, obesity and treatment compliance, besides others. The list is gradually expected to expand.

Apparently, encouraged by this trend, more pharma players are now moving into this area for significant brand value for augmentation through better patient outcomes – apace with providing a unique disease treatment experience for suffering individuals.

The scope in India:

As WHDs have a close link with both Internet and Smartphone penetration, let me try to weigh the potential of the wearables, in view of the current status of both in the country.

According to the India Internet 2019 Report by Internet and Mobile Association of India (IAMAI), the following three points are indeed noteworthy, besides others:

  • With 451 million monthly active internet users at the end of financial year 2019, India is now second only to China in this regard.
  • Urban India with 192 million users had almost the same number of users as rural India. However, in terms of percentages or penetration, given the disparity of population distribution in urban and rural India, urban India had a considerably higher penetration level.
  • In rural India, a sizable portion does not have access to the Internet, and provides a huge opportunity for growth which will contribute to an increase in the overall Internet population over the next few years, it said.

Similarly, according to the Statista report, for 2017, the number of smartphone users in India was estimated to reach 299.24 million, with the number of smartphone users worldwide forecast to exceed 2.3 billion users by that time, and was projected to be nearly 2.7 billion by 2019.

These numbers speak for themselves on the underlying opportunities of WHDs – both globally and locally. Accordingly, large pharma players have already started teaming up to deliver better patient outcomes, leveraging the value of WHDs.

Pharma players teaming up to deliver better patient outcomes with WHD:

There are several such examples. Nevertheless, to illustrate the point, let me cite one such recent instance of Abbott Laboratories announcing a deal on February 20, 2019 with Novo Nordisk to make diabetes management easier by linking technologies of the two companies. The deal will allow integration of insulin dose data for Novo Nordisk’s pre-filled and connected pens with its ‘FreeStyle’ Libre mobile app and cloud-based system.

‘Abbott’s ‘FreeStyle’ Libre Continuous Glucose Monitoring (CGM) system will read glucose levels through a sensor that can be worn on the back of the upper arm eliminating the need for routine finger pricks. Through the FreeStyle LibreLink app users can capture and view their real-time glucose levels, their eight-hour glucose history, and how their glucose is currently changing on their smartphone.’

Yet another report highlighted, ‘Google sister-company Verily is teaming with big pharma on clinical trials.’ On May 21, 2019, the company announced strategic alliances with the pharmaceutical companies Novartis, Sanofi, Otsuka and Pfizer to help it move more deeply into the medical studies market. The goals for Verily, and its pharma partners, are to reach patients in new ways, make it easier to enroll and participate in trials, and aggregate data across a variety of sources, including the electronic medical record or health-tracking wearable devices,’ the report emphasized.

Conclusion:

It seems clear that in the rapidly transforming digital world, many drug companies are realizing the criticality of making their business operations sine qua non with the evolving trend is essential. This is not just for the organization progress, but also for long-term survival of the business. In the midst of this exciting technological environment, the potential value of WHDs to deliver better patient outcomes is being brought to the fore, primarily by the pure tech companies.

Figuring out the magnitude of the new opportunity, several pharma companies have thrown their hats in the ring, primarily in the form of collaborative deals. This ushers in a new phase in the healthcare space. Mostly because, such initiatives will have to be patient-centric for providing a unique patient experience with the drugs, in the disease treatment process. As India too, is taking rapid strides for penetration of digital technology in its ‘Health for All’ initiatives, the use of WHDs for better and cost-effective patient outcomes isn’t a pipe dream, any longer.

The evolving scenario, therefore, opens yet another door for the pharma players to grow their business, not just with drugs offering differential value, but also by making even a ‘me-too’ drug perform better, leveraging the potential of WHDs, effectively. From this perspective, continuously honing patient outcomes with WHDs, appears to be a unique tool for pharma marketers to make use of – in search of excellence.

By: Tapan J. Ray   

Disclaimer: The views/opinions expressed in this article are entirely my own, written in my individual and personal capacity. I do not represent any other person or organization for this opinion.

 

Is India in The Eye of The AMR Storm?

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‘With 700,000 people losing battle to antimicrobial resistance (AMR) per year and another 10 million projected to die from it by 2050, AMR alone is killing more people than cancer and road traffic accidents combined together.’ This was highlighted in the Review Article, ‘Antimicrobial resistance in the environment: The Indian scenario,’ published in the Indian Journal of Medical Research (IJMR), on June 03, 2019.

The article further noted, ‘AMR engendered from the environment has largely remained neglected so far,’ which has a snowballing effect. Illustrating the enormity of its impact, the researchers recorded: ‘Economic projections suggest that by 2050, AMR would decrease gross domestic product (GDP) by 2-3.5 percent with a fall in livestock by 3-8 percent, costing USD100 trillion to the world.’

Besides International media, fearsome consequences of AMR are also being highlighted by the Indian media from time to time. For example, on November 21, 2018, a leading national business daily carried an apt headline: ‘India in the firing line of antimicrobial resistance.’ More intensive coverage of such nature for this public menace, would hopefully appeal to the conscience of all those who can meaningfully address this situation, especially the government.

Against this backdrop, I shall explore in this article, whether India is really in the eye of this AMR storm, which is posing an unprecedented threat to many lives, perhaps more in India. 

India is being called the AMR capital of the world: 

Analyzing the emerging research data in this area, India was referred to as ‘the AMR capital of the world,’ in the 2017 Review Article, title ‘Antimicrobial resistance: the next BIG pandemic.’ Curiously, besides umpteen number of published papers documenting this scary development, very few enlightened individuals would dare to push an argument to the contrary. Whereas, besides framing a policy document on AMR,nothing much is changing in India on this score. This is happening, even when it is evidenced that a gamut of the most powerful antibiotics, are not working against many deadly bacteria. Added to it, India still doesn’t have a public database that provides death due to AMR.

Are adequate resources being deployed to fight the menace:

Today one would witness with pride that India’s ‘Chandrayaan 2’ lunar mission is moving towards the Moon’s south polar region, where no country has ever gone before. At the same time, despite AMR threat, India’s budgetary allocation for health in 2018-2019, reportedly, shows a 2.1 percent decrease of the total Union Budget from the 2.4 percent in 2017-2018.

It is interesting to note that India: ‘Despite being the world’s sixth largest economy, public health spending has languished at under 1.5 percent of GDP, one of the lowest rates in the world. For comparison, the United Kingdom shelled out 9.6 percent of its GDP in 2017 on health. The United States’ health expenditure is 18 percent of GDP.’

‘Ayushman Bharat’ and health care infrastructure:

Recently lunched public health program - Ayushman Bharat, although is not a Universal Health Care (UHC) program, it has targeted to cover ‘less than half the population and excluding 700 million people’. While giving a thumbs-up to this initiative, if one looks at the overall health infrastructure in India to make it possible as intended, it may not encourage many.

To illustrate this point, let me quote only the salient points, as captured in a 2018 study, published in the British Medical Journal, as follows:

  • The total size of health workforce estimated from the National Sample Survey (NSS) data was 3.8 million as of January 2016, which is about 1.2 million less than the total number of health professionals registered with different councils and associations.
  • The density of doctors and nurses and midwives per 10,000 population is 20.6 according to the NSS and 26.7 based on the registry data.
  • Health workforce density in rural India and states in eastern India is lower than the WHO minimum threshold of 22.8 per 10,000 population.
  • More than 80 percent of doctors and 70 percent of nurses and midwives are employed in the private sector.
  • Approximately 25 percent of the current working health professionals do not have the required qualifications as laid down by professional councils, while 20 percent of adequately qualified doctors are not in the current workforce.

The intent to deliver health care as announced by various governments from time to time is good. But, the available health infrastructure to deliver these meaningfully are grossly inadequate, creating a huge apprehension among many. This is not just because of the grossly inadequate number of hospitals, doctors, nurses and paramedics, but also their even uneven spread in the country. The cumulative impact of these, fueled by corruption, ‘missing doctors, ill-equipped health professionals, and paucity of required funds’ continue creating a humongous problem for the public, at large, to get affordable health care.

At the same time, there is ‘a serious lack of new antibiotics under development to combat the growing threat of antimicrobial resistance.’ Imagine, a situation when India gets caught in the eye of the AMR storm and imagine the consequences of that, as you deem appropriate.

Lack of new antibiotics under development to combat AMR:

The World Health Organization (WHO) report - ‘Antibacterial agents in clinical development – an analysis of the antibacterial clinical development pipeline, including tuberculosis’, launched on September 20, 2017 shows ‘a serious lack of new antibiotics under development to combat the growing threat of antimicrobial resistance.’

It further reported: ‘Most of the drugs currently in the clinical pipeline are modifications of existing classes of antibiotics and are only short-term solutions.’ The report also found, very few potential treatment options for those antibiotic-resistant infections identified by WHO as posing the greatest threat to health, including drug-resistant tuberculosis which kills around 250 000 people each year.

Thus, the point to ponder simultaneously is, whether there is any decline in global investments for antibiotic research, both by the drug industry and the public funders.

Declining investment on new antibiotic R&D: 

As stated in the May 2016 paper, titled ‘Tackling Drug-Resistant Infections Globally. As the report indicates: ‘The UK Prime Minister commissioned the Review on Antimicrobial Resistance to address the growing global problem of drug-resistant infections. It is chaired by Jim O’Neill and supported by the Wellcome Trust and UK Government, but operates and speaks with full independence from both.’

The report acknowledges that new antibiotic research and development has been suffering from decades of under-investment by companies and governments. The reason being, antibiotic discovery and development are no longer an attractive proposition for commercial drug developers, for a key fundamental reason:

And this is, lack of a dependable, commercially-attractive market for antibiotics that meet large unmet medical needs. As a result, the volume of sales of a such new antibiotics will be low, and restricted only to multi-drug resistant bacteria. Otherwise, older and cheaper antibiotics will still work against most other infections. In that scenario, patented new antibiotics will have to compete with generics, keeping the price low. This combination of price pressure and low volumes makes antibiotics unattractive as a commercial proposition for many drug developers.

Which is why, as the report says: ‘Less than 5 percent of venture capital investment in pharmaceutical R&D between 2003 and 2013 was for antimicrobial development.’ Against total venture capital investment of USD 38 billion in pharmaceutical R&D, antimicrobial venture capital investment was mere USD 1.8 billion, during the same period. Coming back to India specific concerns, let’s have a look at the sociocultural issues in the country, associated with AMR.

Sociocultural issues are fueling the fire:

Understandably, the AMR problem remains intricately intertwined with a number of sociocultural issues of India. It has been established in several studies that social level, socioeconomic and socio-cultural status can play a significant role in the health status of people. Most research done on this subject indicates that higher level of socioeconomic classes reflects at a higher level of health and longevity. Much of this comes from the fact that there is a higher level of education and health care that is available for ‘this class level’.

Sociocultural issues in India also includes, poor hygienic practices, inadequate clean water and good sanitation facilities across the country, besides improper implementation and lack of good governance of health policies, rules and regulations. These factors are also aggravating the AMR problems in the country, as stated in the article, titled ‘‘Public Health Challenges in India,’ published in the Indian Journal of Community Medicine, in its April-June 2016 issue. Which is why, just addressing the indiscriminate use of antibiotics and restricting its wide consumption, aren’t not enough, any longer.

Is India in the eye of the AMR storm?

‘Antimicrobial resistance (AMR) has emerged as a major threat to public health estimated to cause 10 million deaths annually by 2050. India carries one of the largest burdens of drug-resistant pathogens worldwide.’ This was highlighted in the research paper, titled ‘Antimicrobial resistance: Progress in the decade since the emergence of New Delhi metallo-β-lactamase in India’, published in the Indian Journal of Community Medicine, on March 12, 2019.

The article noted, ‘AMR has been identified as a global health threat with serious health, political, and economic implications.’ The paper concluded with a serious note, which is worth taking note of. It found, the full throttle efforts to tackle the AMR challenge in India still requires significant efforts from all stakeholders. It underscored, ‘Despite the adoption of a national policy and significant activities already underway, progress is limited by a lack of clear implementation strategy and research gaps.’ 

Suggested areas of focus in India:

As ‘the Sword of Damocles’, in the form of AMR, hangs over the head of Indian population, there are certain important measures that the country can definitely take to contain AMR, whereas some other critical ones will be challenging to roll out, immediately.

It is unlikely, during this period India will have the requisite wherewithal to focus on discovery and development of new antibiotics to tackle AMR. Similarly, only framing rules and regulations for doctors, patients, dispensing chemists or hospitals to prevent antibiotic misuse, which are not persuasively yet strongly implemented, won’t also yield desired results. Nevertheless, efforts must continue for their effective compliance.

That said, what the country can seriously focus on, sans much constraints, is on taking collective measures in resolving some of the crucial but intimately associated sociocultural issues, with all sincerity and precision. A few of these important areas include, intense public awareness campaigns on the growing threat to life due to AMR, clubbing the benefits of availing good sanitation facilities, hygienic lifestyle and everyday practices.

Moreover, misuse of antibiotics in poultry, animal farming and agriculture should be curbed. Alongside, mass vaccination program for prevention of bacterial and viral infections, should be made available all over the country. Monitoring of the incidence of death due to AMR, on an ongoing basis, is another practice should also feature in the must-do list, providing access to this database to public. Responding meaningfully to International coalition for country-specific action, is also very important. To attain this goal a healthy socioeconomic environment needs to be encouraged, with corruption free efficient governance.

Conclusion:

That India is in the eye of the AMR storm, can’t be wished away any longer. Thus, the fight against AMR will need to be a well-orchestrated one, engaging all stakeholders as partners. The private sector should also actively participate in the AMR awareness programs under public–private partnership (PPP) or through Corporate Social Responsibility (CSR) initiatives.

The whole process should be backed by a creative strategy, having buying-in from all concerned, but spearheaded by the government. That’s the minimum that, I reckon, should happen when the country is in the eye of the impending AMR storm.

By: Tapan J. Ray    

Disclaimer: The views/opinions expressed in this article are entirely my own, written in my individual and personal capacity. I do not represent any other person or organization for this opinion.

 

The Challenge of Holistic Value Creation With Pharma M&A

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Two mega deals, right at the dawn of 2019 gave a flying start to Merger & Acquisition (M&A) activities, in search of inorganic growth, by some large pharma companies. The two biggest ones are Bristol-Myers Squibb’s (BMS) USD 74 billion buyout of Celgene, and AbbVie’s USD 63 billion purchase of Allergan, as announced on January 03, 2019 and June 25, 2019, respectively. However, overall in the second quarter of 2019, there were, reportedly, only 22 deals – ‘the smallest quarterly deal count for at least a decade.’

As a strategic option for greater value creation to drive growth, M&A is being actively considered over a long period of time. The key focus of such value creation for the company remains primarily on enriching the pipeline of New Chemical or Molecular Entities (NCE/NME) for revenue synergy, besides cost synergy. This is understandable. But, for various reasons, alongside, a key question also comes up for debate – is the core purpose of such value creation to drive companies’ growth, primarily with more number new drugs, sustainable? The query assumes greater relevance in the evolving new paradigm. This is because, a basic shift is taking place in the core organizational purpose of value creation.

Thus, it appears, the nature of value creation through M&A would also matter as much. Can it still remain a drug company’s financial health centric, any longer? Should the M&A initiatives also not take under their wings, the value-offerings expected by patients from a drug company – beyond innovative pills? Would a holistic value creation through M&A would now be the name of the game? If so, how?  The discussion of my today’s article will revolve around these questions. Let me initiate the deliberation by recapitulating the key motivation behind M&A initiatives of the drug industry.

A key motivation behind the M&A initiatives in the drug industry:

While recapitulating one of the key motivations behind pharma M&As, let me refer to some interesting and recent studies, such as, the 2019 paper of McKinsey titled, ‘What’s behind the pharmaceutical sector’s M&A push.’ It also acknowledges, the use of M&A to bolster drug innovation is unlikely to change any time soon.

That many drug companies actively pursue the M&A option as a game changer for inorganic growth, is vindicated by the recent big deals, as quoted above. Since early 2000 and before, the companies that made the biggest deals to create new value synergies with, have been paying heavy deal premium to enrich their new product pipelines. Quite often it includes several new and emerging classes of drugs, as acquisition targets.

This also gets corroborated in the Press Release of the 2019 BMS deal, which says: ‘The transaction will create a leading focused specialty biopharma company well positioned to address the needs of patients with cancer, inflammatory and immunologic disease and cardiovascular disease through high-value innovative medicines and leading scientific capabilities.’

Lesser yield of traditional pharma M&A than the broader market:

This was emphasized in the June 06, 2019 article, published in The Washington Post, titled ‘Big Pharma Has to Bet Big on M&A. Investors Don’t.’ The analysis found, the returns from the big pharma deals ‘don’t look as good compared to the broader market’, although for very patient investors many of these have resulted in longer-term gains. To illustrate this point, the paper pointed out: ‘Of the eight biopharma deals worth more than USD 40 billion that closed in the last 20 years, only one delivered better returns than the S&P 500 five years after it closed.’

Naming Merck & Co..’s USD 47 billion acquisition of Schering-Plough Corp. in 2009, the researcher justified: ‘That deal is arguably something of an accidental winner. Long-term success didn’t come from any of the products that Merck targeted in the merger; instead, an afterthought of an antibody that was initially set to be sold off became Keytruda, a cancer drug that’s projected to generate USD 15 billion in sales in 2021.’

Innovative product launches no longer a holistic value-creation for patients: 

Thus, unlike yesteryears, enriching new and innovative product pipeline through M&A won’t serve the key purpose of value-creation for patients to treat deadly diseases in a holistic way. The primary reason for the same was articulated in the Deloitte Paper titled, ‘Disruptive M&A: Are you ready to define your future?’ The article emphasized: ‘The confluence of technological change, shifting customer preferences, and convergence across sectors is redesigning how products and services are developed, delivered, and consumed.’

Thus, mere acquisitions of innovative product portfolios, intended to provide better treatment choices for patients, may not meet the holistic needs of consumers’ while going through the disease treatment process. In depth understanding of such preferences with all associated nuances, is absolutely essential in today’s complex business scenario. Which is why, it calls for avant-garde type or ‘disruptive M&As’, that can help alter the business growth trajectories, making the disrupted company disrupt the competitive space, being game changers of the industry.

Calls for avant-garde type or disruptive pharma M&As:

Today, it’s crucial for any drug company to create a unique treatment experience for patients. This is emerging as a pivotal factor for the success of a brand.

Even most innovative products will need to be supported by disruptive back-office technology for market success. Thus, acquisition of disruptive technology to effectively augment the brand value delivery process is equally important, in tandem with enrichment of new product pipeline. This is expected to emerge as a critical driver in pharma M&A. Such takeovers, I reckon, may be termed as avant-garde type or disruptive M&As – for holistic value creation for patients.

‘Disruptive M&A’ creates a much broader range of possibilities and targets:

For a holistic value creation through disruptive M&A focus for target selection needs to be significantly different from the standard models of M&As – and not just about the quality of NCE and NME pipeline. The above paper also highlighted: ‘Disruptive M&A opportunities requires evaluating and assessing a much broader range of possibilities and targets than traditional M&A.’

With the right kind of target selection after a thorough analysis of the business model, disruptive M&A may help the acquiring drug companies to go beyond achieving revenue and cost synergies. It can also provide cutting-edge business capabilities, alongside enriching and expanding the talent pool, key business processes, and, of course, the state-of-the-art technology –inorganically.

Initiatives and focus of drug companies of this genre, are expected to be more in the coming years, primarily driven by a new type of value creation to offer a unique disease treatment experience for patients with their respective brands.

A new type of value creation for patients in healthcare space:

It has already started happening in the recent years. For example, Amazon, on January 30, 2018 , announced, it is collaborating with Warren Buffet’s Berkshire Hathaway, and the bank JP Morgan Chase to create an independent, nonprofit health care company ‘with the goal of increasing user satisfaction and reducing costs.’ They also announced the organizational focus on two of the following areas, which are interesting and unconventional:

  • Technology solutions that will provide U.S. employees and their families simplified, high-quality and transparent healthcare at a reasonable cost.
  • Draw on their combined capabilities and resources to take a fresh approach.

As the New York Time (NYT) reported: ‘The alliance was a sign of just how frustrated American businesses are with the state of the nation’s health care system and the rapidly spiraling cost of medical treatment.’ The report further added: ‘It also caused further turmoil in an industry reeling from attempts by new players to attack a notoriously inefficient, intractable web of doctors, hospitals, insurers and pharmaceutical companies.’

Although, this has happened in the United States, it sends a strong signal to the state of things to come sooner than expected in the health care space, dominated, so far, by pure pharma and biotech players, across the world.  New types of value creation for patients of similar nature, especially by tech greenhorns in the pharma space, can be wished away at one’s own peril.

Consumer-focused digital companies redefining healthcare value creation:

‘2019 EY M&A Firepower’ report also highlights the innovative efforts of consumer-focused, digital companies to carve out a solid niche for themselves in the pharma dominated health care space. With ‘effective deployment of their ‘connected devices, data analytics skills and deep consumer relationships, these new entrants are positioned to have access to important real-world data that could, in part or in full, determine future product utilization and payment,’ as the report emphasized.

Such fast-evolving development also prompt pharma players to act fast. And the most practical way of doing so, with a high possibility of success, is through disruptive M&A. Ongoing entry of consumer-focused, digital companies in health care increase the urgency for life sciences companies to act, now.

Conclusion:

Thus far, pharma and biotech companies have been engaged in a massive wealth creation for themselves by using their biological and chemical know-how for novel drugs and devices. This ballgame has to change now, ‘as the lines between health and technology continue to blur’, according to the EY Firepower report.

Capabilities of big data and analytics will increasingly be more essential for success, regardless of having a rich pipeline of NCEs and NMEs, even with the potential to achieve blockbuster status in the market. Thus, the ballgame has to change.

Against this backdrop, the key challenge of pharma players for a brighter tomorrow would undoubtedly be ‘holistic value creation.’ Its core purpose should be to deliver a unique patient experience, encompassing the entire disease treatment process – going beyond innovative drugs. One of the quickest routes to create this virtuous cycle, I reckon, is through ‘disruptive M&As – moving away from the traditional model for the same.

By: Tapan J. Ray   

Disclaimer: The views/opinions expressed in this article are entirely my own, written in my individual and personal capacity. I do not represent any other person or organization for this opinion.