A Digital Prescription for the Pharma Industry

In two years, 93% of US doctors will be using electronic medical records-up from 30% two years ago-and 97% will have electronic access to treatment protocols, more than double the rate in 2011, according to Bain research (see chart below). Most US healthcare providers and payers also will go digital over the next five years.

That profound shift (among others) has pharmaceutical companies pouring money into digital tools and initiatives to keep pace, but a lot of those investments are wasted.

Why? The initiatives are scattered and unfocused. At one global pharma company, we found more than 200 digital projects and 2,000 related websites, many of which lacked the necessary coordination. The leadership team had no overview of the various activities and, as a result, derived little benefit from them.

In order to make digital tools pay off across a complex value chain, pharma companies have to do a much better job linking data, analytics, workflow, and connectivity. The real value comes from integrating internal data smoothly across business functions and with external data systems. A handful of digital forerunners lead the way, developing integrated strategies, making smart use of real-world data, and investing in a great digital customer experience. 

Big data’s ‘real’ deal 

Let’s look at how that kind of approach works with real-world data. Increasingly, real-world data is disrupting the traditional approach to medical reimbursement as payers demand evidence of efficacy beyond the lab. In the future, only companies that use real-world data to demonstrate superior outcomes for new drugs will generate attractive returns. 

Big Data analytics, for example, helps pharma companies to harness real-world data to accelerate drug discovery while also providing valuable health economics and outcomes data for access, pricing, and safety. Bayer invested in generating real-world data for its anticoagulant Xarelto to address concerns about bleeding as a side effect. It used data from existing disease registries and funded new studies. The real-world trial of 6,784 patients showed 96 out of 100 subjects did not experience any major bleeding or related side effects, which helped convince payers to reimburse patients and accelerated the drug’s acceptance in the market.

Most pharma companies lack the real-world data to benefit from analytics, modeling and simulation. Without it, all research trends look equally interesting. Combined with the right tools, however, data becomes a torch in the

darkness. The companies that are working on harnessing real-world data on a large scale are poised to reap big gains. According to a recent forecast by IMS Health, the top 10 pharma companies could each unlock up to $1 billion in value by tapping into real-world data.

But even the biggest players will need strategic partnerships to obtain it. Clinical trials represent only a sliver of the world’s healthcare data. As the industry and governments adopt data tools such as electronic medical records and patient reporting platforms, they will increasingly partner to create rich troves of real-world data.

To harness real-world data, forerunners invest in comprehensive digital platforms that integrate internal data with external data systems, linking, for example, regulatory affairs, clinical research, and marketing. These platforms include the capability to semantically normalize and clean data from vastly disparate sources that are intended for widely varying uses.

The experience effect

In addition to implementing advanced data platforms, successful companies get closer to customers, patients, and other stakeholders by offering them a positive digital experience. Bain research shows physicians already spend significantly more time online for professional reasons than with pharma sales representatives. As payers and providers increasingly seek medical information online and embrace outcomes-driven healthcare, digital forerunners are participating in these new models of clinical decision making.

The leaders use an omnichannel approach and personalized marketing to build a digital customer experience and increase their reach while significantly raising return on marketing and sales investments. Cost-effective technology tools help companies move from a siloed view to an integrated view of customers, ensuring messages are consistent and aligned as communication channels proliferate. 

Merck & Co. embraced a new multichannel approach to launch Januvia, a drug for type 2 diabetes, making extensive use of the Internet and other new media for prelaunch education, as well as targeted communication to doctors through representatives and online physician marketing, promotion, and communication. That strategy helped Januvia rack up sales of more than $750 million in its first year and hit blockbuster status one year later.

Personalized marketing harnesses digital connectivity and data to address the individual consumer directly in real time with offers that are based on individual behavior and preferences such as over-the-counter treatments for sports enthusiasts or pregnant women. Pfizer offers a free mobile app called Pfizer CVM to increase awareness of cardiovascular problems such as blood pressure, diabetes, and cholesterol.

Real-world data and digital customer experience are two fields where digital forerunners are making great strides. But a digital strategy can affect the entire value chain. Improved transparency with customers and suppliers, for example, can help companies minimize working capital and improve forecasts. One helpful way to think about digital options is to break them into a manageable number of thematic clusters. These clusters become a useful roadmap of digital opportunities, helping leadership teams focus on the areas most important to them (see chart).

Set priorities

There is no right answer about where to start the digital journey. What’s important is choosing a few high-priority areas that represent the greatest return for the lowest cost, risk, and investment of time, based on a company’s strategy. Leadership teams that set clear priorities now will be able to cut through the digital noise and develop competitive advantage in a changing landscape. 

Michael Kunst

(

michael.kunst@bain.com

),

Ashish Singh

(

ashish.singh@bain.com

), and

Grace Shieh

(

grace.shieh@bain.com

) are all partners with Bain & Company, and are based in Munich, Boston, and Shanghai, respectively. 

Simon Kennedy

  (

simon.kennedy@bainadvisor.com

) is a Bain advisor based in Boston.