Highly regulated and strictly adherent to predictable, validated outcomes, the life sciences industry is now facing a unique disruption of its own – brought on by an explosion of data, increasing regulations, decreasing margins, industry consolidation, and digitalization.
The solution? Create new value through digitalization of the business model and accelerate innovation.
Easier said than done!
For the manufacturers of pharmaceuticals, biological products, and medical devices, digitalization is either a golden opportunity to better serve patients or a massive threat to the traditional rank and order. On a recent episode of Internet talk radio program Changing the Game with Life Sciences, special edition series of Coffee Break with Game-Changers, presented by SAP, a panel of three industry-leading experts gave their take on where the industry was headed and what opportunities they foresee for those agile and innovative enough to fill gaps in the value chain quickly.
Joining moderator Bonnie D. Graham on the panel were: Joe Miles, global vice president of Life Sciences at SAP; Shawn Brodersen, global chief technology officer of the SAP Practice at HCL Technologies; and Rasmus Nelund, vice president of Life Sciences and general manager of International Operations at NNIT A/S.
The following are just some of the observations presented during the one-hour show. For more information, listen to a complete recording of the show: Reimagining Business Models in Life Sciences
Balancing speed of innovation with commitment to the patient
Joe Miles: “It’s just a remarkable time. That’s really showing in new business models that are bringing competitive advantages for organizations, but at the same time, providing levels of care, treatments, and therapies that are attacking long-held terrible diseases. Now we actually have an opportunity to help people get back on the healthy path after dealing with some of these traumatic illnesses.”
Shawn Brodersen: “What we’re talking about is change, but we’re also talking about guarantees of outcomes. In highly regulated industries like life sciences, there’s a certain comfort and a requirement to do things in a very consistent and repeatable fashion because it’s a validated industry and we want validated outcomes. We don’t want to get the wrong drugs to the patients or the wrong devices to the patients.”
Rasmus Nelund: “Both commitment and especially imagination are needed right now in the Life Sciences industry to imagine what is in the future. Is it going to be a technology trip in the future? Are the drug producers of today going to be reduced back in the value chain and take over some platforms towards the patient? That requires a lot of imagination about how we can realize the benefits of digitalization and at the same time, the commitment to the passion for the patient.”
Patient data streams and payment models
Miles: “Similar to every other industry, life sciences is being impacted globally with digitalization, specifically from smart devices. Real-world data streams from patients’ smart devices will generate massive amounts of data, providing more accurate insights into patients’ conditions. The supply chains have to change. The manufacturing process has to change. The delivery model has to change. The interaction with the physicians and the patients has to change. Those are radical changes and digital technologies are what are really enabling that. The devices are giving us greater visibility and transparency at the patient level. But further then, the models that are coming out of that to support that process and those products are also equally as transformational.”
“Real-world data streams from patients’ smart devices will generate massive amounts of data, providing more accurate insights into patients’ conditions.”
Brodersen: “When [Joe] talks about that data stream and where that data stream comes from, you’re not just disrupting the Life Sciences industry, but you’re looking at industries around insurance models. You’re talking about industries for consumer goods, where these devices are embedded and created. There is a potential revenue stream to those companies, whether it’s Nike, Under Armour, FitBit, Apple, or Google.
From a patient’s perspective, you really have two groups that will look at this in two very different ways. One is ‘my information is my information and I’m not particularly interested in sharing.’ The other one is maybe a bit more modern, like, ‘hey, if this proactively helps me solve for future health problems, then I’m more than happy to share.’
How do we manage the data and how do we keep that confidential? How do we give the patient control over what they share and how they share it, and do that in a very personal, secure way? I think that’s one of those things that digital transformation needs to address.”
Nelund: “It is true that the whole product is changing. In the old days, we went to the doctor, who wrote the prescription for a drug. Then we went to the pharmacy, got the drug, and it worked. That’s going to change into a combination of both the drug and some hardware or software – also, all the life sciences data surrounding the patients, because a lot of the decisions we have today are also about lifestyle, and researchers are curious to understand the lifestyle of the patient and thereby make the drug more personalized.
Going back to what Shawn mentioned there about the platform, I think the winners of this industry are going to be the ones who own the patients’ data at the end. Then they can use what they’ve seen in other industries with Uber, Airbnb, and Amazon. Not to mention, if you own the data about the consumer, then you also own the market.”
Blockchain as cure-all?
Brodersen: “At its core, blockchain is simply a database, a technology, a way of restoring and sharing information in a network of commonly interested peers in a supply chain or a value chain. As a patient, if I go into a doctor’s office today, what’s the first thing they do when you sign in? ‘Please fill out these ten pages so that we know something about you.’ If I have to go to a second doctor’s appointment, they don’t share any of that information with the next doctor. A lot of that has to do with regulations and some of it has to do with it’s just the way it’s always been done.
What blockchain potentially could do is give the individual the opportunity to store that information in a very secure digital wallet, and then to decide, using cryptography and tokens, how they hand that information out in the network. There’s really, in my view, no good reason why this can’t be something that is adopted and looked at as a way to radically change the patient’s experience.”
Nelund: “I think it is a perfect example of how blockchain can be used to trail information and make it more personalized. Also, we talk about data as the most valuable asset of a company and potentially, because we used a blockchain to track the data, we would have a digital audit trail.
Imagine you are running a clinical trial in 26 countries with 5,000 patients and you get data points in every second day and you need to be capable of reproducing that study that has run for two years and have transparency for the FDA to trust the data. So, we need to have a full audit trail. That is quite cumbersome today with the computer system validation, but it’s quite necessary.”
Miles: “The example Shawn gave was very simple, yet an elegant and transparent way of how the technology could be leveraged. You can see that extended across more of the consumer experience. You can also see that taken further as we start to get into other areas where we think about data integrity. That data integrity could pertain to the integrity of a product; for example, the serial number on the product that you’re using. Is that a valid serial number? Is that a valid drug that you’re taking? Our ability to have that irrefutable data point, to know within that distributed network that we have valid information that can never be altered—that is a very valuable and a very interesting capability that can be done on a global basis and can be expanded in a variety of ways.”
Tune in to changing the game in life sciences
Join us for more episodes of Changing the Game in Life Sciences to hear how the digital economy is changing the life sciences industry. For more up-to-the minute business and technology news, listen to Coffee Break with Game-Changers broadcast live every Wednesday, 8:00 a.m. Pacific / 11: 00 a.m. Eastern Time on the VoiceAmerica Business Channel. And follow Game Changers on Twitter at @SAPRadio and #SAPRadio.
Panelists’ comments have been edited and condensed for this space.