Charles Farkas wants to transform healthcare. That may seem like a pretty lofty aspiration, but Farkas, a senior partner at Bain & Company and head of the firm's North American Healthcare Practice, says now is the time for change. "I think it's an extraordinary time in healthcare," Farkas says. "I think we're looking at global opportunities to transform healthcare—both at the company and system level. And if we get it right, I actually think we can do a lot of good along the way. I think we have to find ways to clearly articulate what high-quality healthcare is. Globally, healthcare is very expensive, and the people who need it most often aren't getting it—not because of affordability or access to it, but because their symptoms are misdiagnosed or because other things interfere with that process." The first place he would start is research and development. "I think the R&D process, particularly in the pharmaceutical industry, is fundamentally broken," he says. "The time it takes to develop a truly valuable new drug is now to the point where the return on that investment is becoming unattractive, even if it's a $1 billion drug. So, clearly, there's a need for fundamental re-invention there."
That re-invention includes rethinking what kind of drugs to develop, as well as the process of using resources both inside and outside of pharmaceutical companies to help develop those drugs, he says.
Farkas, who has been with Bain for nearly three decades, had done plenty of work as a generalist with healthcare companies. So when it came time for Bain to launch a healthcare practice in 2004, Farkas fit the bill. "When I joined Bain, I never imagined I would still be here 28 years later," Farkas says. "I was on my way to getting a PhD in history and—like a lot of people—I thought consulting would be a great launching pad for something else. Early on, I was surprised how much impact I could have with clients, and when I was ready to do something a little more entrepreneurial, Bain offered me the opportunity to build one of the firm's very first practice areas."
The first thing he did was find talented people—both inside and outside of Bain—to work in the practice. The second part was figuring out how to close the healthcare gap with McKinsey & Company and The Boston Consulting Group, Bain's two main competitors in the space.
Both firms have much bigger and more firmly established practices. "I can honestly say we're closing the gap, but those other practices are so huge and had such a substantial head start over us that we have to
take a long-term view," he says. "It'll be some time before we catch them, but we differentiate ourselves by driving results and offering clients highly customized solutions."
The healthcare practice at Bain has been growing at 20 to 30 percent a year and currently has 35 partners in North America and 60 partners globally. Bain term limits mean Farkas only has about 18 months left in his current role, so "most likely, it'll be up to my successor to catch [the competition]."
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