In 2013, Lee and Porter a assessed that the days of business as usual in health care are over and outlined a strategy to fix health care and maximize value for patients while mitigating or even reducing health care costs. Five years later, things have been changing in a sense that health care organizations put more and more patients at the heart of health care systems. As said by Lee and Porter, setting the value goal as the health outcomes that matter to patients is still vivid.
However, this new strategy was not addressing the role of pharma industry and other providers in the health care systems. A recent analysis by Stott b shows that the Big Pharma industry is on the brink of terminal decline. Stott has computed data highlighting that industry return on R&D investment will go downhill and reach a breakeven in 2020.
Either this will spur this industry to improve execution and increase productivity or move to new business models. The emerging technology, such as. immune-therapies, can open new cycles. However, how long will this be sustainable and deliver a return on investment while cycles are getting shorter? And therefore, what are the territories, meaning new business models, that the pharmaceutical industry has to contemplate?
Let’s make a case with a major and global epidemic- obesity. To put the problem into perspective, the direct cost of obesity in the US is estimated at $ 152 billion C. Food companies with their knowledge in nutrition and channel to consumers are better positioned to cope with this major epidemic.
Few major food companies like Nestlé have set up their institute of health sciences d and develop health care solutions through nutrition targeting a wide spectrum of diseases – obesity and weight management, but also brain health, gastro intestinal health etc. The development of sound science in gut microbiotia e is giving a solid foundation to develop health and nutrition solutions. And yet, though both food and pharma industries are complementing each other’s strengths and knowledges, no significant merger or partnership has happened yet.
A key factor of success and driver of this transformation of health care system is the development of health data management platforms. Pulling and crunching our personal data f in genetics, medical, nutrition habits etc…will be soon a huge leverage to improve our health. The power of analytics and coming soon artificial intelligence will revolutionize health care. By the way, Google g and Chinese data giant Tencent have been massively investing in the field for the past years.
The evidence of such development in our daily lives is the increasing use of sensors and wearables to acquire data on various aspects of our lives—health, fitness and nutrition aiming to improve health self-sensing, self-awareness.
Our data is a raw material that we can store (unfortunately still at a high cost for the planet).
If not the new gold h, our data is the new oil that will be transformed into products and services that will deliver health outcomes that matter to patients. The flip side of this will be the ownership of our personal data, and accordingly the freedom to choose our lifestyle
After writing this paper, I thought about the closing questions raised by Harari in his latest book i: “What will our society become when learning machines will know more about us than ourselves?”.
a @Michael E. Porter and Thomas H. Lee https://hbr.org/2013/10/the-strategy-that-will-fix-health-care
b @Kelvin Stott https://endpts.com/pharmas-broken-business-model-an-industry-on-the-brink-of-terminal-decline/
c Harvard Edu site: https://www.hsph.harvard.edu/obesity-prevention-source/obesity-consequences/economic/
f @ John Wilbanks https://www.ted.com/talks/john_wilbanks_let_s_pool_our_medical_data
i “Homo Deus”, Yuval Noah Harari