Innovation for Health: Success Factors for the Research-Based Pharmaceutical Industry

Abstract

Over the last decade, the pharmaceutical industry has undergone a period of breathtaking change driven by scientific progress and changing market realities. A description of the drivers of the industry and the key levers of pharmaceutical innovation leads to the conclusion that, although the business model remains essentially without alternative, it needs to evolve.

Pharmaceutical companies have been reinventing their business model as they have diversified away from the blockbuster model into portfolios of more targeted medicines in strategic therapeutic areas, as well as into other segments such as generics and biosimilars, consumer products, vaccines, or animal health. For companies focusing on patented medicines, the ability to foster research productivity and innovation while globally increasing access to these drugs is crucial for their success.

The research-based pharma industry is currently in the early stages of the next phase of significant change: real-world outcome data from clinical practice will be increasingly digitized and analyzed, in addition to existing data sets derived from clinical trials. The ability of companies to make use of “big data” will become key to innovation and the improvement of health outcomes, both by optimizing existing treatment options and by gaining new insights for research and development purposes. The pharma industry has the chance to make use of this big data opportunity in the best interests of patients and overall healthcare value, at a time of growing political pressure to short-term drug budget savings.

As companies invent new business models to better manage health outcomes, they will sustain focus on covering unmet medical needs through scientific insights and by expanding access to their medicines. The success factors underpinning the evolving business models of research-based pharma companies will be expanded on below.