Much more than ever before, the use of digital solutions and apps is high on the agenda in many board rooms and executive offices of pharmaceutical companies. Especially in the context of Digital Therapeutics (DTx) as a complement to traditional drug therapy. However, the digitisation of healthcare will have a far larger and more sweeping effect on existing pharma business models: it will deprive the established “Share-of-Voice” pharma market model of its importance and replace it with a “Share-of-Data” model.
For decades, the number of interactions and contacts to physicians as potential prescribers (Share-of-Voice) has been the basis of the pharma industry’s commercial reasoning. For this, many companies have been building huge sales forces. A first blow to this approach has been dealt by regulations limiting the number of physician visits by pharma reps in several countries.
The emergence of digital tools and solutions - and especially the associated data collection and analytics capabilities - will further diminish the significance of the Share-of-Voice commercial model and replace it with a data-driven one.
What are the reasons behind and how will a new market model for pharma look like?
Towards a Share-of-Data market model
Over the past few years, findings from biomedical research, single cell analysis or genomics have opened up completely new therapy options for many diseases. In order to realize and apply these new opportunities, it has become necessary to find out and understand in a much deeper way the distinct biological and physical conditions of patients and combine them with lifestyle-, behavioural- and social data to end up with a set of reliable bio-markers.
At the same time, digital tools and data analytics have provided us with the capability to not only collect data directly from the patient (Real World Patient Data), but also to consolidate and analyse them in a way that enables faster and evidence-based clinical decision making and personalized delivery of care.
Therapy decisions will become increasingly driven by the availability of personalized data and bio-markers and by the use of clinical decision support tools. These tools will be powered by clinically validated AI technology and respective algorithms.
For the pharmaceutical industry this has far-reaching consequences: companies need to ensure that their health offerings - traditional drugs as well as Digital Therapeutics (DTx) or digital care tools – are part of such clinical decision support platforms. This is what is referred to as a “Share-of-Data” market model.
The importance of closely engaging with patients
Patients will play a much more important and influential role in the future. This is mainly due to two reasons: firstly, and as pointed out above, clinical decision-making will be based on Real-World-Patient Data. Hence, a direct access to patients will be needed. Secondly, the availability of digital assistants and applications will enable them to define a treatment pathway that is adapted to their individual life situations. Pharmaceutical companies will need to build completely new models of engaging with patients during all stages of their treatment journey to find out about their wants and needs and resulting care offerings. True patient engagement often goes beyond what is usually referred to as “patient centricity”, as it implies that patients are an inherent and firm part of research and commercial activities, rather than being regarded as an outside influential factor.
Building a partner ecosystem
Future healthcare will be far more holistic than it is today: it will include a number of care solutions and services, including elements such as traditional drugs, but also digital tools and companions, Digital Therapeutics (DTx), data-driven therapy decision platforms or predictive and preventive care models.
If pharmaceutical companies wish to position themselves as providers of such a holistic care delivery (rather than just supplying components of it), they need to build an ecosystem of solution- and service partners with complementing products and capabilities.
Implications for pharmaceutical companies and recommendations
It is highly likely that much of the future value creation will happen outside of pharma’s traditional commercial and market models. Treatments will increasingly become more individualized, holistic and data-driven. The utilization and success of a therapy regimen and its components will rely on the availability of Real-World Patient Data and their analysis, rather than on their share-of-voice in the medical community.
In the light of these developments, pharmaceutical companies should adapt their value chains and business models and consider how to embrace the emerging data-driven treatment approaches. In this context, it is of particular importance to build patient engagement and access capabilities and design partnering models to build respective ecosystems.
Last but not least, pharma companies should think about how they can move their focus away from being product / brand centric to disease centric to be able to address the emerging holistic care paradigm.
If you want to take a closer look at the changing business environment for pharmaceutical companies and resulting opportunities, please reach out to us.