By Leena Gupta, manager, Deloitte Center for Health Solutions, Deloitte Services, LP
Next week will mark a full year since the WHO declared COVID-19 a pandemic. Since then, over 116 million cases have been reported globally and around 2.6 million people have lost their lives.1 In addition to its mounting human and societal impact, COVID-19 has significantly impacted most businesses and sectors, including the biopharmaceutical (biopharma) industry. This week, we share a blog by our colleague Leena Gupta, Manager at the US Center for Health Solutions, which explores how the pandemic has impacted biopharma’s various functions across the value chain and the strategies that have been adopted to help the industry respond and, ultimately, thrive. While Leena’s blog and research focussed on primarily on US policies, there are wider lessons that all geographies could benefit from. Over to Leena.
The COVID-19 pandemic has affected all aspects of life. Not even the biopharma industry—which we are hoping can forge a path back to normalcy—has been immune to disruption. In less than a year, the industry has developed vaccines and therapies that are effective at preventing and treating COVID-19. At the same time, biopharma companies have had to adapt their other businesses (the ones that develop and deliver medicines for a variety of conditions) to a rapidly changing world.
The newly installed Biden administration could bring fresh ideas to help solve some pandemic-related challenges, but it’s likely that we will be masked and socially distant from one another for the foreseeable future.
What does this mean for biopharma? Last fall, we spoke to biopharma leaders from across a variety of functions to understand how the pandemic has altered the way they work. We also asked them to predict how it might have permanently altered the way they work in the future. In our recently released paper, Breaking barriers to digitization in biopharma: The pandemic’s impact on R&D and commercial operating models, we detail their responses, which were mixed in sentiment. Here is what we learned about some of the major headwinds the industry is facing:
- Non-urgent health care has slowed: Many patients put off non-urgent care and avoided medical settings last year. These consumers were likely either afraid of contracting COVID-19 or didn’t feel that their condition was bad enough to seek treatment and risk exposure to the virus. While demand for some pharmaceuticals has remained consistent, therapies that have to be administered during a hospital or clinic visit took a hit in sales. Moreover, new patients weren’t identified as often, and patients who were on existing treatment regimens often weren’t counseled to perhaps switch to something new or more effective. As the pandemic drags on, and as patients continue to delay care, sales for some drugs could continue to decline. As a result, patients might seek care only after an illness has progressed.
- New drug launches have been delayed: The pandemic has made it difficult to introduce new drugs to the market with the hope of gaining market share or meeting original sales forecasts. New diagnoses and regimen switching aside, marketing channels are not as robust as they were before the pandemic. COVID-19 content continues to dominate the few channels that are open.
- Most sales reps aren’t well-equipped to work virtually: Sales representatives are a critical communication channel between manufacturers and the prescriber, but they tend to be less influential in a virtual world. Physician preferences for sales calls are also changing. Identifying suitable digital sales platforms has been challenging for many biopharma companies and, thus far, has been less successful than hoped.
- Traditional site-based clinical trials need a technological upgrade: Clinical trials across the board have been delayed by COVID-19, especially those in the early stages of development. As traditional study settings closed, investigators often weren’t equipped to gather data remotely, and many patients became more reluctant to participate. Some therapeutic areas were hit especially hard. While some of the development time can be made up, there are questions about resource allocation and investments in digital technology to keep trials running both now and into the future.
Many biopharma companies are receptive to the type of change that might be required to thrive in a COVID-19 (or post-COVID-19) world. Many companies have changed the way they work, at least for the short term. But old habits die hard. Change is also expensive and could require organizational transformation. And before any transformational plans can be considered, leadership will have to be on board with the idea.
In the meantime, manufacturers should continue to build out their digital competency. This includes adopting a patient-centric approach to clinical trials that includes relevant technologies (e.g., remote monitoring and at-home diagnostics). They should also reconsider their go-to-market strategies and customer-engagement models to control costs and expand existing revenue streams.
But there are other questions biopharma company executives should be asking themselves, including:
- Where can we expect profits to emerge or decline? And how should we rebalance our portfolios accordingly?
- How can we drive greater operational efficiency and develop disruptive capabilities?
- Where should we look to partner, versus build internally?
The pandemic has exposed long-standing inefficiencies within biopharma operating models and has become a tipping point for transformation that was long overdue. If the pandemic continues to delay pipelines, we could start to see more mergers and acquisitions in the industry as manufacturers look to shore up their portfolios in the short-term. But in the long-term, accelerating the adoption of technology to democratize clinical trials—as well as to engage physicians and patients in more meaningful ways—will likely be critical to remaining competitive and resilient. In his 2021 outlook, Mike Delone, who leads Deloitte’s life sciences sector, predicted that companies would start to push past their 20th century business models this year and take significant steps toward the Future of HealthTM.