Pharma 2020: Challenging business models

Which path will you take?

Most Big Pharma companies have traditionally done everything from research and development (R&D) through to commercialisation themselves. However, by 2020 this model will no longer work for many organisations. If they are to prosper, they 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. These activities few companies, if any, can accomplish on their own.

Pharma 2020: Challenging business models , the fourth in the Pharma 2020 series, explains how even the largest pharmaceutical companies will have to collaborate more closely with players inside and outside the sector to be able to respond to the demands from the different stakeholder communities. To do so they will have to ‘profit together’, by joining forces with a wide range of organisations, from academic institutions, hospitals and technology providers to companies offering compliance programmes, nutritional advice, stress management, physiotherapy, exercise facilities and health screening.

The paper suggests that alternative business models with varying degrees of collaboration will emerge to provide a basis for the industry to operate more effectively as times change. It also evaluates the advantages and disadvantages of each alternative, their strengths and weaknesses and lists some key questions to make the transition to a new business successful.

More information

Pharma 2020: The vision , first in the series highlights a number of issues that will have a major bearing on the industry over the next 11 years. Thepublication outlines the changes we believe will best help pharmaceutical companies realise the potential the future holds to enhance the value they provideto shareholders and society alike.

Pharma 2020: Virtual R&D, the second in the series explores opportunities to improve the R&D process. This paper proposes that new technologies willenable the adoption of virtual R&D; and by operating in a more connected world, industry, in collaboration with researches, governments, healthcare payersand providers, can address the changing needs of society more effectively.

Pharma 2020: Marketing the future, the third in the series discusses the key forces reshaping the pharmaceutical marketplace, including the growingpower of healthcare payers, providers and patients, and the changes required to create a marketing and sales model that is fit for the 21st century.

Pharma 2020: Taxing times ahead, the fifth in the series focuses on the industry's opportunities and challenges from a tax perspective. It discusses how the political, economic, scientific and social trends currently shaping the commercial environment, together with the development of new, more collaborative business models, will exert increasing pressure on effective tax rates within the industry. It also shows how companies can adapt their tax planning to support the provision of outcomes-based healthcare and remain competitive.

Pharma 2020: Supplying the future -- Which path will you take?
How pharma companies will have to develop different supply chain models for different product types and patient segments, learn to use their supply chains as a means of market differentiation and source of economic value, and recognise the key role information will play flowing upstream to drive the downstream flow of products and services.