Accelerate & Manage Innovation and Digital Transformation in Pharmaceutical Industry

A roadmap for pharmaceutical executives to steer through the complexities and prospects of the digital age!

In the 21st century, the pharmaceutical industry is being revolutionized by two significant trends: pharmaceutical innovation and digital transformation. Pharmaceutical innovation encompasses the creation of novel medications, treatments, and medical devices aimed at enhancing patient health and quality of life.

·       Digital transformation in the pharmaceutical industry is encompassed of integrating digital technologies like artificial intelligence, big data, cloud computing, and blockchain to improve the value chain's efficiency, quality, and competitive edge.

·       Navigating the intricacies of pharmaceutical innovation and digital change demands strategic foresight, collaborative ethos, consumer-oriented perspectives, and an adaptable, swift organizational structure. This article explores the leading strategies for handling pharmaceutical innovation and digital advancement in the industry, drawing on the expertise and experiences of top authorities.

A. Integration of Innovation and Digital Transformation

·       To effectively handle pharmaceutical innovation and digital transformation, it's essential to integrate them with the company's strategic objectives and ambitions. This entails ensuring that such initiatives are influenced by consumer demands, market dynamics, and the organization's unique strengths, rather than solely by prevailing technological fads or buzz.

·       A study from Accenture reports that the pharmaceutical firms achieving the greatest success are those with a definite and consistent approach to innovation and digital transformation, ensuring their investments, competencies, and corporate culture are in harmony with their strategic goals. For instance, Pfizer's approach revolves around "breakthroughs that change patients' lives", focusing on creating cutting-edge medications like the COVID-19 vaccine and adopting digital solutions like remote monitoring and telemedicine to enhance patient and stakeholder results.

B. Foster A Culture of Innovation And Digital Transformation Across The Organization

·       To further pharmaceutical innovation and digital progress, the second measure is promoting a company-wide culture that values innovation and digital evolution. This involves incentivizing originality, trial-and-error, knowledge-sharing, and teamwork among staff, collaborators, and clients. It also means accepting that change, risk, and setbacks are integral to the journey of innovation and digital transformation.

·       A McKinsey survey suggests that pharmaceutical companies leading in innovation and digital maturity are characterized by a foundational culture of innovation and digital transformation reflected in their values, conduct, and routines. Novartis is cited as an instance with its "unbossing" culture that encourages employees to adopt entrepreneurial mindsets, question existing paradigms, and collaborate beyond traditional limits. Novartis has launched Biome, a digital innovation lab that serves as a collaborative space for both in-house and external creators to develop and trial new digital health care solutions.

C. Build and leverage a diverse and multidisciplinary innovation and digital transformation ecosystem

·       The third phase in managing pharmaceutical innovation and digital transformation involves creating and utilizing a varied, multidisciplinary ecosystem for innovation and digital change. It implies that the entity must leverage the knowledge, assets, and connections from a wide array of parties including academic institutions, emerging businesses, tech firms, regulatory bodies, financial contributors, service providers, and consumers. Furthermore, it should forge and partake in collective venues, coalitions, and collaborations designed to promote the sharing of concepts, information, and innovations.

·       A Deloitte study indicates that pharmaceutical companies at the forefront of innovation and digital proficiency are those with a robust, active ecosystem for innovation and digital transformation, enabling them to tap into new abilities, markets, and customer bases. As an illustration, Roche has collaborated with numerous tech firms, including IBM, Google, and Microsoft, to harness their expertise in artificial intelligence, cloud technology, and data analytics. Together, they aim to create innovative digital solutions for tailored medical treatments, pharmaceutical research, and managing clinical studies.

D. Adopt a customer-centric and value-based approach to innovation and digital transformation

·       A further step in embracing pharmaceutical innovation and digital transition is to take on an approach focused on customer value and centered around the consumers in both innovation and digital change. It implies that the company ought to develop and offer its products and services with consideration for the desires, preferences, and responses of its clientele, as well as evaluate and convey the benefits and effects these products and services have on their customers' health results and life quality.

·       EY's report states that pharmaceutical companies at the forefront of innovation and digital adoption are characterized by their focus on customer needs and a value-driven approach. By utilizing these approaches, they distinguish themselves from their rivals, enhance customer loyalty and contentment, and improve their pricing and reimbursement methods. For instance, Sanofi focuses on a customer-oriented and value-driven strategy for innovation and digital change, employing it to introduce new offerings such as digital therapeutics, patient assistance programs, and contracts contingent on results, aiming to better the health and welfare of their clientele.

E. Invest in developing and acquiring the skills and capabilities for innovation and digital transformation

·       Another strategy for driving pharmaceutical innovation and digital change is to develop and acquire the essential skills and capabilities required for innovative and digital advancements. This implies that the organization must discern and rank the skills and abilities crucial for innovation and digital transformation, like data science, digital design, agile development, and change management. Furthermore, it should offer the necessary training, equipment, and resources to its employees, partners, and customers to develop and improve these competencies.

·       A PwC report suggests that the pharmaceutical companies leading in digital proficiency and innovation are those which have committed to nurturing skills essential for digital innovation as well as acquiring them. They employ these proficiencies to launch new products and services, enhance their operational effectiveness and quality, and promote progressive change within their organizations. For instance, AstraZeneca has dedicated resources to growing and obtaining the necessary skills for innovation and digital change, utilizing these to develop a digital strategy, start a digital academy, and set up a digital innovation center.

F. Implement a robust and flexible governance and management framework for innovation and digital transformation

·       To oversee pharmaceutical innovation and digital transformation effectively, it's crucial to put into place a strong, adaptable framework for governance and management. It is critical for the organization to establish and enforce policies, processes, and standards governing innovation and digital transformation. This includes developing a clear strategy, vision, and roadmap for innovation and digital transformation, managing the associated portfolio, budget, and performance metrics, as well as ensuring adherence to ethics, compliance, and security measures related to these initiatives. Furthermore, the organization must continuously review and refine these guidelines to stay aligned with the ever-changing dynamics of innovation and digital transformation.

·       A KPMG report highlights that the pharma companies excelling in innovation and digital prowess are those with strong, adaptable structures for governing their innovative initiatives and digital overhauls. These companies successfully utilize this framework to streamline and manage their activities in these domains, keep a keen eye on results, and effectively address potential risks and challenges associated with innovation and digital change. As an illustration, Merck has established a strong and adaptable governance and management structure for innovation and digital transformation. This framework is leveraged to harmonize and manage its initiatives across different business divisions and sectors. It also serves to track and assess the results of these ventures through the use of key performance indicators and dashboards. Additionally, it provides a means to oversee and lessen potential risks and obstacles associated with innovation and digital transformation by employing a risk management system and a committee dedicated to digital ethics.

G. Learn and improve continuously from the innovation and digital transformation experience and feedback

·       The last and crucial step in overseeing pharmaceutical innovation and digital transformation is to engage in constant learning and enhancement, drawing from the experiences and evaluations encountered throughout the process. It is essential for the organization to gather and scrutinize data and insights derived from its innovation and digital transformation endeavors, including customer feedback, market reactions, and performance and impact of these initiatives. These data and insights should be leveraged to pinpoint and execute advancements and upgrades in the organization's product and service offerings, processes and operations, and skill sets and competencies.

·       A study by BCG found that the leading pharmaceutical companies in innovation and digital success are characterized by their ongoing learning and improvement from their experiences and feedback in innovation and digital transformation, leveraging this knowledge to enhance and accelerate their innovation and transformation efforts more efficiently and cost-effectively. For instance, through ongoing learning and enhancements from its innovative initiatives and digital overhauls, Johnson & Johnson has managed to expedite and refine the process of innovation and transformation in a cost-effective manner. This has been achieved by introducing a digital innovation challenge, forming a digital innovation hub, and setting up a network dedicated to digital innovation.

References

·       BCG. (2020). The 2020 Most Innovative Companies: Overcoming the Innovation Readiness Gap.

·       Deloitte. (2019). The Future of the Life Sciences Industry: An Analysis of the Forces Shaping the Industry.

·       Accenture. (2019). The Future of Pharma: Five Strategies to Accelerate the Transformation of the Pharmaceutical Industry by 2030.

·       EY. (2019). Progressions 2019: Life Sciences 4.0: Securing Value Through Data-Driven Platforms.

·       KPMG. (2019). Pharma Outlook 2030: From Evolution to Revolution.

·       McKinsey. (2019). How Pharma Can Accelerate Business Impact from Data and Analytics.

·       PwC. (2019). The Future of Health: A New Vision for the Pharma Industry.