Rhenu Bhuller, a founding member of Frost & Sullivan’s Asia Pacific operations and expert in analysing the impact of cutting-edge tech, looks at pharma’s evolution and adoption of digital health.
The evolution of disease management and the convergence of drugs, devices and digital health in the management of various conditions now require pharmaceutical companies to embrace digital health as part of their DNA.
The pharmaceutical industry is among the most heavily regulated and highly competitive industries in the world. Its origins can be traced back to the early chemical industry of the late 19th century in the Upper Rhine Valley near Basel, Switzerland when dyestuffs were found to have antiseptic properties. The industry expanded rapidly in the 1960s, benefiting from significant discoveries and a relaxed regulatory environment. During this period, healthcare spending boomed as global economies prospered. The pharmaceutical industry continued to grow with large pharmaceutical companies finding success with patented blockbuster drugs. In the 1970s, the industry witnessed major developments with the introduction of tighter regulatory controls and industry changing regulation, including the regulations governing the manufacture of “generics”, which fostered the creation of the generic pharma industry. The market has since continued to evolve at an ever increasing pace, faced by patent expirations, rising costs and complexities of drug development, increasing regulatory barriers and price controls.
The evolution of disease management and the convergence of drugs, devices and digital health in the management of various conditions now require pharmaceutical companies to embrace digital health as part of their DNA and today almost every major pharmaceutical company has a digital strategy, although the stage of evolution varies widely from company to company.
For pharma, the interest in digital technologies that might have begun primarily as a marketing lever is now seen as increasingly essential for business viability due to the need to improve efficiency in clinical trials (including pharma-digital products) and/or to improve and extend existing products, prove value and efficacy to payers and providers to ensure reimbursement in the new era of value-based drug purchasing, and drive medication adherence for better patient outcomes and build patient centricity vs a traditional provider-centric approach. Examples of areas where pharma companies are investing in digital solutions are in drug discovery and research and development, clinical trials and real-world evidence, supply chain, digital marketing and consumer-centric services.
With the convergence of technology, new applications and increased focus on value-based care, pharma companies are slowly evolving their value chains with greater focus on digitalisation and a medicine-as-a-service (MaaS) model as opposed to the traditional volume-based care model.
A shift towards value-based models alongside a growing focus on digitalization of drug development process is imperative. IT players such as Google, Microsoft etc., are collaborating with pharma companies to provide software applications, mobile health apps, smart health devices aiding in internal process automation, patient monitoring as well as easy diagnosis for healthcare professionals and consumers. Strategic partnerships likely offer the best path forward and expect to see more of these arrangements. Pharma/digital health partnerships like Qualcomm Life and Novartis, IBM Watson Health and Johnson & Johnson, Otsuka and Proteus Digital Health, and others are key enablers of success as the industry transitions to new digital product lines and new business models.