Changing business models for pharmaceutical industry
This page is under construction and edited by Murat Akguc EMBA09. In case of any questions/remarks, feel free to contact me
Description:
The pharmaceutical industry as we know it today will be radically transformed. The conventional wisdom of producing blockbusters and securing strong, stable earnings under patent protection is no longer a foolproof success formula.
Pharmaceutical companies are hemmed in from two directions. On one end, they are entering a period of thinning drug development pipelines, patent expirations and competition from generics1. On the other end, the increasing influence of the patient in making healthcare decisions and the emergence of new intermediaries and service providers undermine the traditional physician-pharmaceutical sales representative relationship as the main channel through which drug choices are influenced and made.[1]
Enablers:
- Increasing Cost of R&D
- Struggling old world economy
- Increasing Private Funding (Venture Capital) for Biotech Research and Start-up financing
- Increasing Willingness and/or Ability of Governments to Sponsor Biotech Research
- Increasing Consolidation and Alliances among Pharma Companies
Inhibitors:
- Low Entry Barriers
- Increasing Patent Expiries for Blockbusters
- Competition from Generics
- Insufficient connectivity between the key players Decline of (R&D) cooperation between public and private
Paradigms:
Big Pharma Companies will need to improve their R&D productivity, reduce their costs, tap the potential of the emerging economies and switch from selling medicines to managing outcomes.
Experts:
Sources for additional information about this driving force. (if you have found people, put the links to them)
Timing:
Web Resources:
[1] Business Model of the Information Age Pharmaceutical Industry, The Information Management Group (http://www.img.ch/upload/63001e_White_Paper_Business_Model_of_the_Information_AGE_-_Pharmaceutical_Industry_282.pdf)
- Pharma 2020: Challenging business models, PricewaterhouseCoopers, (http://www.pwc.com/gx/en/pharma-life-sciences/pharma-2020-business-models/index.jhtml)
- Pharma 2020: Virtual R&D "Which path will you take?", PricewaterhouseCoopers,http://www.pwc.com/gx/en/pharma-life-sciences/pharma-2020/pharma2020-virtual-rd-which-path-will-you-take.jhtml
- Sustaining Competitiveness through Alliances and Innovation: The impact of Alliance Management Issues on learning skills and competencies from partner(s), Prof. S. Raghunath (Email), Thomas Joseph (Email), (http://dspace.iimk.ac.in/bitstream/2259/492/1/349-358+.pdf)