The following is an excerpt from a new research report from ALM Intelligence on consulting services in the Healthcare industry. For more information, please visit consulting.almintel.com
Innovation to Define the Next Digital LS Market Opportunities
Digital is defining the “art of the possible” in innovation while also redesigning tomorrow’s pharma and medical device realities. While the life sciences industry is generally immature in adopting digital relative to other industries (such as retail or automotive), there have been pockets of digital innovation, particularly in the more mature commercial function with the realization that the patient is the central figure in the new healthcare ecosystem, and patient engagement is key.
Apps, remote monitoring, sensors, and websites are some of the digital tools being developed to increase patient engagement. The innovation in commercial is now being integrated into the R&D function, particularly in the area of clinical trial transformation to enhance participant recruitment, social listening during the trial, and post-trial patient tracking. However, the manufacturing and supply chain sectors of life sciences are gaining steam as well, particularly focusing on the last mile of the supply chain to better manage inventory and customize products.
As David Rosner, Principal, Deloitte Digital Life Sciences Industry Leader, observes, “In the past, we got more narrow questions about which marketing channel to focus on or an HCP engagement strategy. In the last six to 12 months, clients are asking for help thinking about digital across the enterprise. Clients are thinking more broadly and looking at digital holistically; it’s no longer just about marketing.”
According to Accenture, there is $100 billion at stake over the next five years in commercial opportunities with digital enabling significant value for traditional LS players and new market entrants from sectors as varied as technology, telecommunications, retail, and consumer products to create digitally enabled business models.
Arthur D. Little and the Karlsruhe Institute of Technology interviewed 50 senior pharma executives and found that “digital health will transform the business models of the pharmaceutical industry. Although many companies have not yet formulated a concise digital health strategy, industry executives expect that by 2020, digital health will enable pharmaceutical companies to activate new business segments as well as to significantly improve their competitive advantage.” In fact, 84% of study participants considered it crucial to have a digital health strategy in 2020, compared to only 13% who thought it was currently crucial.2
Digital Innovation Changing Business-as-Usual in Life Sciences
Digital is a catalyst to ecosystem alignment as LS partakes in a new digital healthcare world. Driving business and health outcomes from LS treatments effectively means engaging with all major constituents of the LS and healthcare ecosystem. As Shawn Roman, Accenture’s Managing Director – Life Sciences, Digital Customer, explains, “Digital enables connectivity across the healthcare ecosystem creating a multitude of opportunities for a life sciences organization to engage a diverse set of stakeholders, i.e., payers, [integrated delivery networks] IDNs, patients, HCPs.”
The role of LS as a “supplier of treatments” in the healthcare realm through digital companions and data exchanges enable more of a front seat experience between consumers and LS, and can facilitate more adherence and outcomes-born information exchange with physicians and payers, pointing to more effective and cost-benefit value indicators.
LS executives begin to embrace digital, need to link experiences that drive business outcomes. Innovation coming from beyond the four walls is not new, but how pharma and medical device executives view these opportunities is shifting. Consultants are playing a key role in digital as the catalyst for supplying externally sourced inputs into serving unmet needs. According to Neil Saward, Managing Consultant with PA Consulting, “Pharmas have historically been quite good at improving efficiency in the value chain. However, they frequently seek external support when it comes bringing an entirely new capability to market.”
Larry Gioia describes, “Every pharma organization needs to rethink the end-to-end patient experience across the value chain. Life Sciences organizations should take a hard look at consumer experiences and expectations outside of healthcare and consider weaving these ideas into their overall clinical trial strategy. For example, what might an “open table” experience look like within a clinical trial context?”
Moving beyond experimentation, from pilots to full integration. Digital adoption within commercial function is relatively mature at this point and the emphasis is shifting toward clinical trial transformation and the provision of patient services with an end-to-end focus taking shape. Instead of just giving the patient a remote monitoring device, the entire clinical trial experience can be tracked digitally.
Most pharmaceutical organizations are interested in rethinking the clinical trial experience by creating a growing awareness of trials and engaging subjects in order to improve the enrollment process. By leveraging many of the same digital enablers that have been used successfully in commercial areas, life sciences organizations can work closely with providers in the healthcare ecosystem.
Additionally, pharmas can create an end-to-end experience with improved patient post-trial follow-ups and tracking. The clinical trial transformation will need to focus on creating a larger healthcare ecosystem including healthcare providers, LS companies, and payers with patients at the center in order to create a user experience that is convenient and customer friendly, with a platform for patient feedback that also provides important monitoring data to HCPs.
Digital LS must partner to lead in the digital age. Life sciences organizations need to develop digital capabilities across their functional operations to lead in the digital age. Pharma and medical device manufacturers have embraced partnership models more readily in some areas than others, such as contract research organizations (CROs) and contract manufacturing (CM) partners. Accenture’s Shawn Roman observes that “Digital technologies and operating models can breakdown the traditional siloed approaches that we often see between commercial and R&D functions.”
Digital technology can enable change, but the real key to success will be changing business processes in both consumer and LS workflow to ensure better business outcomes. This is an enormous hurdle for the healthcare industry, which is immature relative to others in the digital space and has historically been a rigidly siloed business-to-business system of treatments, payers, providers and the government.
However, consumerism and new market entrants are tearing down traditional silos to create a new environment with huge pressure to achieve both consumer satisfaction and provide more value with better patient outcomes. Patients are now thought of as “customers”—a huge cultural and mindset shift for LS organizations. As Christopher Zant, a Principal in Deloitte’s Life Science Digital Marketing and Patient Digital Engagement practice explains, “We used to think that patients were very different from customers. But we now know that it doesn’t matter if someone is using a fitness app, a movie app or a health app—they’re going to scroll to the bottom and click ‘agree’. At that moment, the patient becomes the consumer.”
During these early stages of digital adoption, many LS organizations are looking to engage consumers more directly as a first step in a digital strategy. Using these patient interactions and the data to drive better business outcomes across the organization is a priority, as David Allen, Director with PwC’s Strategy& New Entrants and Innovators in Healthcare practice, says, “Existing players need to refocus and refine how they think. There are four areas of activity: patient experience, digital care delivery, analytics and infrastructure (shift of care delivery, workforce make-up, impact of R&D, therapies). Patient experience has been a very active space, in part because ROIs and impact are easier to understand. In the other three categories, even the significant activities we see are in just the early stages relative to their eventual disruptive impact on the status quo.”
Most life sciences organizations are at the beginning stages of the digital era of adoption, starting small with consumer-focused engagement and working back to embed digital throughout the organizations’ processes. There are consulting firms just focused on consumer design, agency-like firms dedicated to the user experience, and end-to-end firms focused on providing a strategy for execution covering both consumer and workflow reengineering of processes. Inconsistent patient adherence to treatment protocols contributes to sub-optimal outcomes and increased pressure on healthcare resources, including more frequent hospitalizations. The New England Healthcare Institute (NEHI) estimated that the cost of non-adherence is $100 billion annually in excess hospitalizations alone.
Although using apps to encourage higher rates of treatment adherence is still a relatively new approach, the industry is already developing approaches to quantify patient, provider and caregiver engagements. There is also an increasing need for local market segment analytics to analyze disease states and caregiver network interventions as they relate to outcomes. This will create more opportunity around predictive and proactive wellness as well as pre-treatment indicators to help enable preventative health management.
As digital applications increase, they create a positive feedback loop for pharma and medical device companies as the companies both ingest and produce digital information which, in turn, leads to new market insights. These insights become part of the information flow across the digital LS enterprise and digital LS/HC ecosystem where the “blue sky” of innovations leads applied methods to compete and serve differently, supporting fluid learning and interaction opportunities, as depicted in the figure below.
Consulting is needed to serve the various stakeholders and functional areas respectively and holistically, as unlocking the value from this digital data information flow is an integral gateway to precision medicine, proactive interventions and health outcomes that support total cost of care and population health objectives across healthcare systems.
Liz Leonard is Associate Director, Lead for Healthcare Consulting Research and Laura Becker, Industry Analyst, Healthcare Consulting Research.