Pharma companies are embracing the power of digital to further their progress but there is a need for clear strategic direction to drive optimal value By Lakshmipriya Nair
Permeating all facets of the modern world, digitalisation is not only disrupting the way we conduct our business but also reshaping the way we lead our lives. The widespread adoption of digital technologies for even day-to-day activities as a means to tackle the cash crunch caused by demonetisation in India is a case in point. Yet, the pharma industry has been cautious about going down this route to the point that it has often been labelled a laggard in this arena. Many external and internal factors such as ambiguous regulations, lack of universal standards, ignorance in grasping the true potential of digitalisation, and concerns about return on investments have contributed to the industry’s reluctance when it comes to adopting newer forms of engagement and technology. But, the need to improve manufacturing efficiency, tackle supply chain complexities, handle price and cost pressure, meet changing consumer demands, ensure compliance with global regulations and manage reputations etc. have made it imperative for pharma companies to get on to the digital highway and optimise the benefits of evolving technology trends.
A report from Accenture predicts, “digitisation will spur almost one-third of the growth and an estimated 40 per cent of the profitability in the pharma market by 2020. For those that partially digitise, their business models can drive improved profitability by as much as 27 per cent. But, the true prize will go to those who become ‘digital all-rounders’ and build new business models that address new markets. Our research indicates digital all-rounders will not only grow revenues faster (by as much as 35 per cent), but could also improve today’s profitability baseline by as much as 61 per cent.” (Source: https://www.accenture.com/us-en/insight-highlights-life-sciences-pharmaceutical-grow)
Embarking on a digital journey
Fortunately, the pharma sector is gradually shedding its inhibitions and designing digital strategies to achieve success through mediums like mobile phones, the cloud, advanced analytics, wearables, artificial intelligence and the Internet of Things. ‘Emerging Technologies Energizing the Future of the Pharmaceutical Sector’, a recent analysis from Frost & Sullivan’s TechVision, reveals, “Pharma companies are looking beyond sales of blockbuster drugs, and measuring success by care outcomes. To facilitate this, they are focusing on innovation through emerging technologies.” It also points out that top pharma companies are already leading the way, collaborating with cross cluster technology companies in order to address unmet needs, get a disruptive advantage in industry, and gain diverse opportunities in the market.
To give a few pertinent examples:
- Novartis has signed a deal with Google (Alphabet) that allows it to license Google’s smart contact lens which can measure a wearer’s blood sugar levels.
- This year, Sanofi and Verily Life Sciences came together to form Onduo, a joint venture to develop a comprehensive diabetes management platform combining devices, software, medicine, and professional care.
- Pfizer has utilised digital platfroms to create patient engagement initiatives like Quitter’s Circle, an online endeavour through an app and social media connection to aid smokers kick the habit; and HemMobile, an app to help haemophilia patients and their caregivers track treatment and history.
- Boehringer Ingelheim’s social media strategies have garnered a lot of praise from different quarters. Active on eight out of the 10 popular social networks, their tweet chats with specific topics and hashtags, such as #COPDchat and #ChatAFib gained widespread attention. Twitter itself highlighted one of them as good business practice.
There are several instances on the homefront as well.
- Sun Pharma’s RespiTrack, a mobile app to spread awareness on asthma and ensure patient adherence to treatment regimen.
- Qlik, a provider of visual analytics, and Lupin have signed a deal for data insights across across the latter’s supply chain, finance, and research and development departments to drive rapid and fact-based decisions for the business.
- Janssen, under Connect for Life, an HIV disease management programme launched in partnership with SAATHII, will support the development of m-Maitri, an initiative to educate pregnant women on techniques to prevent mother-to-child HIV transmission.
- DocPlexus, an online venture, is helping pharma companies to connect with over 1,50,000 doctors with their proprietary clinical insights through articles, webinars, CMEs and interviews. These kind of ventures are ushering new means of marketing for the pharma segment.
- Online pharmacies like 1mg, Netmeds.com and Saveonmedicals.com etc are ushering new distribution models and improving supply chain efficiencies, thereby improving access to medicines considerably.
Thus, waking up to the value that can be derived through digital, pharma companies are experimenting with a wide range of initiatives.
So, which are the areas where significant impact can be created through digitalisation? Let’s examine.
Unlocking the power of data
As improving manufacturing and operational efficiencies become paramount, investing in data analytics technologies is pivotal. Souma Das, MD, India, Qlik highlights, “Pharma companies sit on huge treasure troves of data, mostly stowed away in disparate organisational silos. Acquiring the ability to work and sweat that data to gather insights and drive more efficient decisions will help them unlock hitherto unknown potential. Access to insights from one’s data and being able to make faster data-driven business decisions will help pharma companies become more agile and move at the speed of business. Digital enablement helps pharma companies make better business and clinical decisions faster.”
He further explains, “Qlik helps to effectively address the key problem organisations face in determining how the influx of disparate, internal and external data can be managed to allow for real-time analysis. With an exponential growth in data and the value that collective data-driven intelligence brings to any business and organisation, the use of an analytics platform not only requires minimal training, but removes the guesswork needed by users.”
Similar views are echoed by Ettore Cucchetti, CEO, ACG Inspection, ACG Value Links, ACG Pharmagents. He informs, “Digitalisation will help pharma companies capture market insights from consumers, providing actual information about changes in market trends and challenges in the market. We have used ACG Inspection’s cutting edge technology to develop equipment and data management solutions that not only meet regulatory requirements but also meet technological requirements of the global pharma industry. In fact, ACG Inspection is one of the few companies that offer full spectrum of data management from line level to the cloud level.
Phanish Chandra, CEO, DocPlexus, states, “As today’s organisations recognise the benefits of a customer-centric approach, they make attempts to understand the ways in which they can fulfil the needs of their customer groups. Digital technology equips pharma marketers with detailed data-driven insights into physicians’ behavior, brand perception and product impact, among other things.”
Enhancing quality standards
Cloud and mobile technology, sensors, and business intelligence is ushering a wave of automation in business processes which in turn will play a pivotal role in ensuring quality and transparency in the pharma industry.
Ettore explains, “Digitalisation will play a strategic role to enhance and maintain quality in the pharma industry. It will help to have total process control across all stages: right from manufacturing, to the end of the packaging process, to the distribution channel and ultimately to end customer/ consumer level. Through brand protection, supply chain optimisation, development of internet of things, digitalisation can offer better cost control, improved quality and better production yield.”
Das adds to this and states, “It helps shorten discovery – to – commercialisation product cycles, improve physician feedback to manufacturers, and reduce the time and cost of regulatory compliance.”
“It facilitates closed loop marketing wherein doctors’ feedback on a particular marketing initiative is obtained and analysed to assess its effectiveness. Using advanced tracking tools for a range of metrics, pharma can pinpoint exactly what is required by the market and develop perfect solutions,” informs Chandra.
Nishi Gandotra, Co-Founder, Saveonmedicals.com, offers a perspective on how the spread of spurious medicines can be curbed through online pharmacies and says, “As of now, pharma sector, especially retail, is largely unorganised. There is substantial share of spurious medicines in pharma, since many transactions are being done without the proper bills. Digitisation, e.g. online pharmacies, telemedicine platforms bring the probability of spurious medicines close to nil. Every transaction is on record, and the entire chain of transaction from manufacturing to end user can be traced easily. Another big advantage is that digitisation can provide a big pool of data which will help healthcare policy makers to analyse the incidence of various diseases and take steps accordingly.”
Engaging the patients
In Chandra’s opinion, “Digitisation increases visibility and reach. It lays a foundation for long-term engagement with the target audience. ‘Social listening’ ensures that a company takes necessary action to stay relevant even under rapidly changing scenarios. A constant connect with customers equips brands to stay competitive in the event of new product launches.”
He further expounds, “Digital initiatives are set to play a key role in Indian pharma’s success story. Modern medical practitioners favour online media to access latest medical information and network with peers. A significant number of pharma’s future customers (doctors and patients) are going to be digital-natives. Consequently, a brand that is foremost in digital initiatives will gain the most recognition and engagement.”
Thus, it is becoming very evident that at atime when the focus is shifting from blockbusters to personalised medicines, the pharma industry can no more depend on just the traditional means of marketing. Leveraging the potential of the digital would become imperative and hence pharma companies are developing a structured strategy to make it the primary approach for customer engagement can no longer be delayed.
Ettore shares his perspective, “Pharma companies will be using digitalisation to market their brands strongly and effectively to the target audience. Through digitalisation, the pharma companies will be able to provide genuine and authenticated information to their customers. Pharma companies are also looking toward customer/ consumer engagement through digitalisation.”
Das further elaborates on how digital techniques can be deployed by pharma firms to reach out to consumers and says, “Sales people can communicate on patterns they see in their customers and react to changes more rapidly on the ground, at the speed of business. The ability to see and explore the whole story in your data is essential to understanding and improving your business.”
Chandra adds, “Digital initiatives increase the probability of a successful product launch by making a wide audience aware of the uses, advantages, side effects and contraindications of the new molecule. Even before the product is ready to be launched, digital media lend valuable insights into what exactly is needed by the market. This leads to the development of the right kind of product and increases the probability of it being widely accepted.”
He further states, “Digital marketing makes possible a results-driven mindset, in which organisational focus lies firmly on the desired outcomes, and key performance indicators are set keeping these outcomes in mind. It keeps the marketing function flexible so as to swiftly adapt its activities to meet the desired outcomes. Marketers can take immediate steps to respond to customer demands.”
Dealing with VUCA
Another significant advantage of going digital is that it helps pharma players to stay relevant in a world which is beset by volatility, uncertainty, complexity and ambiguity (VUCA). Ettore points out, “Digitalisation is a key factor to keep the variable of VUCA at minimum. Digitalisation helps in risk assessments, to minimise counterfeiting and minimise inventory costs by supply chain optimisation. Secondly, digitalisation will help pharma companies capture market insights from consumer, providing actual information, changes in market trends, and provide the visibility about challenges in the market.”
“In a volatile and ambiguous environment, digitisation becomes all the more important and relevant, since it helps in tracking and monitoring each and every transaction. So, it leaves no scope for misuse of any system. In fact, digitisation can not only help to make healthcare facilities available in remote areas, but also take care of all the anomalies which are prevalent in current scenario.”
Chandra connects it with pertinent, real-time examples and explains, “At present there is a lot of ambiguity around what doctors want from pharma. Efforts made by pharma to understand doctors’ opinions and their latest prescription patterns have proved ineffective as they largely encompass one-way communication – from pharma to doctors. This has left most drug developers shooting in the dark. Digital marketing tools offer analytics-based insights into the physicians’ mindsets which give clarity regarding the type of information that doctors are looking for. Pharma can then communicate only the most relevant content and rest assured that its marketing efforts are not misdirected. Moreover, content that is personalised at an individual level will improve the marketing campaign’s effectiveness.”
He further elaborates, “The USFDA have created uncertainties in the pharma world. Making things worse is the Indian Department of Pharmaceuticals’ recently introduced Uniform Code of Pharmaceutical Marketing Practices (UCPMP). This code marks the government’s move towards ethical pharma marketing practices and is the first step in a larger goal to formulate a compulsory marketing policy. The UCPMP threatens to render most of pharma’s conventional marketing practices useless. Digitisation will ensure that marketing continues to deliver the desired outcomes for pharma even after the UCPMP is enforced. Companies that have embraced digitisation are cushioned from the volatility and uncertainty that could arise from the UCPMP Act. In this scenario, digitisation will enable pharma marketers to build a future-proof knowledge-based relationship through ethical means.”
Challenges to conquer
Thus, pharma companies are utilising digital technologies to open up new vistas for marketing and information exchange between key stakeholders which include key opinion leaders, doctors, therapists, and patients. But, there are several obstacles that could derail Indian Pharma Inc’s digital journey. Chandra draws attention to some of the challenges and lists down a few:
Lack of C-suite support: Digitisation calls for a cultural shift in an organisation. In pharma’s case, strategic commitment of top level executives towards digital marketing is largely absent. Pharma’s approach to digitisation is restricted to individual projects for a particular business unit. This limited adoption will not translate into long-term benefits. Only when top leadership gets serious about going the digital way, will real change occur.
Poor expertise in executing technological changes and digital marketing: Pharma’s core competence lies in R&D of drugs that improve patient outcomes. Digital marketing is a new field that requires huge commitment in terms of time and talent. It is difficult for pharma to put together a cross functional team having expertise in digital marketing, content marketing, multi-media, analytics and data science.
Pharma cannot assure unbiased content: Even if pharma manages to build its own team of digital experts, there will always be concerns over the authenticity and unbiased nature of the content provided on its proprietary apps. Doctors are more likely to opt for neutral platforms that deliver impartial and accurate information on drugs.
Gandotra feels that the biggest challenge is lack of clarity of government regulations. She states, “Most of Indian laws in the healthcare sector were enacted more than 50 years back and these laws have not been updated with changing times. Resistance of new age technology by traditional players has dampened the sentiments of new players in the industry. Government should be taking appropriate steps to promote new age technologies, keeping in mind the interests of consumers, rather than some vested interests.”
Ettore also reiterates, “The challenges include cost and time required for implementation, lack of dedicated and talented resources to understand, design, select and maintain the right digital architecture.”
Thus, several roadblocks exist but it is equally evident that the pharma sector needs to devise strategies to tackle these challenges and cannot shy away from adopting digitalisation. Fortunately, the industry is aware of it.
Chandra advises, “Indian pharma must act fast to adapt to an era dominated by technology. A solid digital strategy will help the industry tide over tough times and continue to be a valued stakeholder in the healthcare ecosystem.”
Ettore also espouses similar views and avers, “Pharma companies need to first understand their digitalisation strategy and objectives. Accordingly, the implementation plan needs to be drafted and implemented in a phase wise manner.”
Ettore states, “Through brand protection, supply chain optimisation, development of internet of things, digitalisation can offer better cost control, improved quality and better production yield. Also, digitalisation can bring pharma companies closer to their consumers, bringing in valuable information which will be essential for future innovations.”
Das informs, “With pharma companies waking up to the inherent benefits of technology, it is only a matter of time before we see commoditisation entering the fray. The time is now to adopt digital technologies that will help improve innovation and commercial models for pharma companies. This will help them gain competitive advantage or less risk losing out. Furthermore, digitalisation can help pharma companies occupy the central position in the healthcare digital transformation.”
“From identifying operational inefficiencies to evaluating and enhancing critical functions such as manufacturing and procurement; from augmenting omni-channel communication and collaboration strategies to driving supply chain efficiencies, more pharma companies are investing in digital technologies than ever before,” he informs further.
A Gartner report also validates this and foretells that IT spending in the life sciences sector will reach $54 billion by 2019, growing at average of five per cent from 2015-2019 annually.
Digital technologies have transformed and disrupted many industries, it seems that now it is the pharma industry’s turn.