A growing and ageing global population increasingly demands access to medicines that will prolong and improve quality of life, while the desire to find sustainable healthcare solutions is driving a focus on prevention and lifestyle intervention.
As a result of pressure on government budgets – from growing populations and the aftermath of the global economic crisis – there is a squeeze on pricing for healthcare products. Businesses within the sector need to find ways to continue to invest in innovation, research and development, while still delivering the required return to shareholders. Pharmaceutical, consumer healthcare, and biotech companies face these challenges against a backdrop of new and increased regulatory pressure and the continued threat of revenue loss as products come off patent and face competition from low-cost generic alternatives.
But the current landscape also brings great opportunity. Technological advances in fields such as data analytics, context-based services, cloud, mobile, wearables and social networking open up new possibilities for organisations to simplify their business model, increase efficiency and interact with patients in ways that have previously not been possible. As the pace of advancement intensifies, those organisations that are able to adapt to, embrace and leverage the power of such new technologies will drive competitive advantage. To position themselves to succeed, organisations within the sector must develop and execute IT strategies that will address some common themes.
Establishing strong foundations. IT is the lifeblood of any life science organisation enabling all business activities from molecule discovery through to distribution of packaged products. Infrastructure and systems must be robust, reliable and scalable, and IT service management processes must be effective to continue to enable business activities without disruption.
Managing IT TCO. With the described threats to revenue growth and a competitive marketplace, life sciences organisations are under increasing pressure to manage costs. This means IT departments must understand their total cost of ownership across all services, and puts a focus on life-cycle management, sourcing, commercial and vendor management, and operational efficiency to ensure that costs are managed.
Simplification. Technically-focused and silo-based decision making have contributed to complexity in IT systems and processes across many life sciences organisations. IT teams need to apply tools and techniques to identify and execute outcome-focused changes that simplify organisational structures, streamline processes, and rationalise applications and services. This will reduce operating costs, increase efficiency and enable IT to drive business innovation.
Agile and adaptable operating models. Many organisations struggle to drive business transformation through adoption of new technology. Businesses should consider shifting organisational models away from conventional functionally aligned operations towards more adaptable structures with multi-disciplinary teams. This includes introducing, acquiring and developing the skills and talent required to drive change and make the most of opportunities around new technology and ways of working.
Leveraging cloud technologies. Historically, concerns around data privacy and regulatory compliance have driven life sciences organisations to take a cautious approach towards adoption of cloud services. While the need to address these concerns has not diminished, services have evolved, with public and private cloud-based solutions now offering an attractive option for life sciences organisations to reduce costs while increasing flexibility and enhancing services.
Extending beyond traditional boundaries. Increasingly the sector is looking for opportunities to obtain new products and increase revenues by acquiring organisations or product lines, or engaging in mergers, collaborations and partnerships. The pace of change in the market is rapid and the ability to react quickly to changes depends on having an appropriate technical architecture based on open standards with simple supporting processes.
Establishing new markets. Revenue growth from traditional life sciences markets has been slowing for many organisations, with increasing proportions of revenues coming from emerging markets. Organisations must develop a technical architecture and operating model that can be extended to new markets and will scale as markets grow.
Getting to grips with big data. There is increasing opportunity to draw new insights from electronic records and data across all aspects of the life sciences sector including electronic health records, patient-provided data, genetic and genomic data, market intelligence, and sales and financial data. Organisations must develop ways to harness the power of this data as well as developing to the ability to collaborate through sharing and using information in controlled ways.
Protecting company assets. While flexibility and agility are essential for success in the digital era, maintenance of security policies and controls has never been more critical. As well as opportunities, technological advancement brings threats, and the frequency and sophistication of cyber attacks is increasing at an alarming rate. Life sciences organisations must have strong controls in place to protect the integrity and privacy of company and patient data.
At Mason Advisory, we understand the challenges associated with delivering business value in the life sciences sector, and have supported global clients with IT decision making and delivery.