Defining the Essentials of the Life Science Industry

In this lesson, we will discuss the techniques of identifying and analyzing industry and market trends and understanding their potential impacts on business operations.

Explore the video to understand current trends like personalization, Big Data, IoT, biosimilar growth, regulations, patient-centric models, healthcare networks, and cost pressures.

Historically, life sciences sectors, such as the Bio-Pharmaceutical and Medical Device industry, concentrated solely on manufacturing drugs and medical products. Currently, they are expanding their offering with services around the drugs and medical products and in future will be enriched by intelligence. Examples include the use of video conference consultations using mobile devices, medical devices that can be operated and remotely monitored by clinicians or patients, and smart devices to monitor health metrics.

This diversification opens new avenues for innovation in life science companies, allowing them to stand out and develop fresh revenue streams and business models that facilitate remote patient care and treatment. Developing tools for remote patient consideration or administering home-based treatments might be tough. Medical device manufacturers, for instance, have mostly been focused on clinical, engineering, and production proficiency, as their main business model was manufacturing rather than servicing.

Currently, many medical device businesses are seeking creative ways to deliver products and services compatible with telehealth and home-use.

Today payers and consumers are the most important stakeholders for pharma companies. More and more engaged and empowered health-care consumers are demanding services and solutions that are convenient and customized including a growing consumer appetite for using technology-enabled care.

Social networks have become customer engagement tools and offer a more personal and open dialogue than traditional marketing channels like advertisements and commercials.

One of the most interesting consumer engagement challenges facing life sciences companies is how to increase consumer trust and improve the overall reputational perception of the industry. Companies are increasingly trying to help patients to navigate the complexities involved in receiving a diagnosis, deciding on treatment, securing financial assistance, connecting with other patients and experts, and adding clinical education.

Finally, the question of pricing is also essential for pharma companies. Pharma companies must find new ways to define value that resonate with stakeholders. Patients are becoming much more active in making their voice heard thanks in part due to social media and advocacy groups.

Digital trends in life sciences apply technologies, including:

• Artificial intelligence (AI) and machine learning (ML) can predict outcomes based on data, perform repetitive tasks, and shed light on how the drugs and device business process can be enhanced.
• Robotic process automation (RPA) technology can automate manual, rule-based tasks, increasing consistent processes, and reducing costs.
• Internet of Things can help getting closer to the patient outside classical hospital settings and connecting with the patient with different types of technology and devices.
• IoT, combined with AI and ML, can indicate when equipment requires maintenance, alert operators to product quality issues, and monitor cold chain processes to minimize waste.

• As we examine the pharmaceutical supply chains, it's noteworthy that despite their complexity, they have historically resisted transformation. However, current pressures and expectations demand that we redesign these supply chains to shift from merely supporting revenue-generating operations to actively contributing to business income.
• Progressive life sciences companies are transforming their traditional, linear supply chains into robust, interconnected systems that incorporate ecosystem partners and continuously evolve to become more agile.
• Tackle counterfeit drugs: The pharmaceutical industry faces significant challenges, including the estimated $200 billion annual market of counterfeit drugs, making it the world's largest market for fraudulent products.
• In third-world countries/regions, the proportion of counterfeit drugs is alarmingly high. Even in developed countries/regions, consumers can unknowingly purchase life-saving medicine from local pharmacies that were previously returned, potentially without adequate verification by manufacturers.
• The increasing global regulations in areas such as R&D, Environmental Health and Safety, and manufacturing require compliance at a manageable cost.
• Personalized medicine is driving radically different supply models, as organizations transition from Make-to-Stock models for blockbuster drugs to Make-to-Order models with batch sizes of one.

The Three Strategic Priorities of Global Leaders in Life Sciences

1. Enable the Digital Supply Chain and Smart Factory:

   Focus on automating shop-floor processes to remove costs and boost efficiency. Ensure compliance with local regulations, track and trace requirements, and optimize supply chain and financial operations. By using Industry 4.0, right-first-time, and manufacturing 4.0 principles, the industry aims to improve manufacturing efficiency, quality by design, and compliance. This paradigm shift includes using modular technology, disposable components, IIoT, smart objects, remote control, and augmented reality, significantly influencing plant design, construction, layout, operation, timing, and overall project cost while maintaining regulatory compliance.

2. Improve Customer Outcomes:

   Shift from volume-based to value-oriented sales with patient-specific optimized outcomes. Emphasize customer-centric strategies including innovative therapies, personalized medicine, and value-based care. Life sciences businesses aim to find the best possible treatment for each patient by advancing digital transformation to create agile, efficient, and cost-effective processes. Mastering these digital trends is critical for competitiveness, allowing businesses to meet new customer and patient demands and dominate their markets.

3. Compete as an Ecosystem:

   Integrate suppliers, contractors, and logistics providers for real-time collaboration. Enhance B2B commerce, quality partnerships, and implement direct-to-consumer delivery models to provide personalized medicine based on real-world evidence. This approach drives down costs and improves efficiencies through collaboration with partners from across the health sciences network, including logistic third-party providers for cold chain drugs. Understanding new business models relevant to supporting collaboration across value chain entities is vital for success.