Introducing the Pharma 2020 series

The Pharmaceutical industry's long successful strategy of placing big bets on a few molecules, promoting them heavily and turning them into blockbusters worked well for many years, but its R&D productivity has now plummeted and the environment’s changing. PwC1 believes that seven major trends are reshaping the marketplace:

• Instances of chronic disease are increasing, placing even greater pressure on already stretched healthcare budgets
• Healthcare policy-makers and payers are increasingly mandating what doctors can prescribe
• A growing number of healthcare payers are measuring the pharmacoeconomic performance of different medicines. A widespread use of electronic medical records will give them the data they need to insist on outcomes-based pricing
• Boundaries between different forms of healthcare are blurring, as clinical advances render previously fatal diseases chronic and the self-medication sector expands
• Demand for medicines is growing more rapidly in the emerging economies than the industrialized economies
• Governments are beginning to focus on prevention rather than treatment, although they have not yet invested very much in pre-emptive measures; and
• Regulators are becoming more cautious about approving truly innovative medicines.

These trends will compound the challenges Pharma already faces, but they’ll also provide some major opportunities.

So what must the industry do to capitalise on them?

We think that it’ll have to improve its understanding of disease, reduce its R&D costs significantly and spread its bets to improve its productivity. It’ll also have to tap the potential of the emerging economies and switch from selling medicines to managing outcomes. However, few, if any, companies will be able to perform these activities alone.

Find out more - download our Introduction to the Pharma 2020 Series.

_{¹“PwC” refers to the network of member firms of PricewaterhouseCoopers International Limited (PwCIL), or, as the context requires, individual member firms of the PwC network.}