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.