6 Healthcare Trends Impacting Pharma Commercialization
What commercialization strategies should life sciences companies focus on as they look ahead? It’s crucial to monitor trends closely to navigate the evolving healthcare landscape better and build winning strategies. Here are the top six healthcare trends affecting pharma commercialization today:
1. Patient financial responsibility
Healthcare costs are increasingly burdensome for many patients. In 2021, total out-of-pocket patient obligations amounted to about $91.6 billion, up 10% from the previous year. What’s more, patient financial responsibility is expected to increase annually by 9.9%, hitting $800 billion by 2026. Already, 3 out of 10 Americans cite high out-of-pocket costs as a barrier to obtaining care. An estimated 13 million U.S. adults fail to fill their prescriptions due to affordability issues. Pharmaceutical manufacturers will need to adopt pricing strategies and meaningful interventions to address patient financial obligations and drive medication adherence.
2. Value-based payment
The U.S. healthcare industry is under extreme pressure to contain soaring costs, particularly as the population ages. In the fight to manage unsustainable healthcare costs, policymakers and payers are focusing on value-based payment models. Value-based payment is “a concept by which purchasers of health care (government, employers, and consumers) and payers hold the health care delivery system at large accountable for both quality and cost of care.” The shift from fee-for-service has led to payers establishing treatment protocols, such as tiered drug formularies. The Department of Health and Human Services (HHS) recently announced a plan to curb drug prices through value-based payments. As pay-for-performance escalates, pharma companies need to be prepared to demonstrate value to payers.
3. Consumerization
The rise of digital technologies over the last decade fueled the growth of consumerization within healthcare. The COVID-19 pandemic has only accelerated this trend. Patients-turned-consumers are demanding the same access, convenience, and transparency they experience in other industries. Today’s patient is in the driver’s seat – they are more informed and more proactive about their care. Pharma manufacturers can take advantage of this trend by finding innovative ways to engage and empower patients.
4. Big data and analytics
Big data refers to the vast amounts of data that inundate businesses and organizations every day. According to the Healthcare Information and Management Systems Society (HIMSS), big data and analytics are top trends in healthcare. Currently, big data is categorized by what is known as the five V’s:
Volume
: There is more data than ever collected from various sources, such as smart devices, transactions, social media, medical equipment, and more.
Velocity
: Data streams are coming in at an unprecedented speed – often in real-time – from Apps, patient portals, and electronic health records.
Variety
: Data comes in all types of structured and unstructured formats.
Veracity
: Verifying the quality of data is essential to ensuring its credibility.
Value
: What data brings to an organization, such as improving health outcomes, defines its value.
According to McKinsey & Company, the application of big data analytics in the pharma industry can lead to better decision-making and a value generation of $100 billion across the U.S. healthcare system. Manufacturers have the opportunity to leverage data analytics to drive market access.
5. Artificial intelligence
Big data is the foundation of artificial intelligence (AI), which according to IBM, “leverages computers and machines to mimic the problem-solving and decision-making capabilities of the human mind.” AI offers health science companies opportunities to address many challenges, including finding new ways to lower costs, improve outcomes, and design effective commercialization, marketing, and post-launch strategies. Recent research finds that about 50 percent of global healthcare companies plan to implement AI strategies and broadly adopt this advanced technology by 2025. In fact, the size of the global AI healthcare market is expected to reach $67.4 billion by 2027.
6. Specialty drugs
Specialty drug development is a rapidly expanding area in pharma, and the utilization of these medications is expected to grow exponentially in the coming years. In fact, nearly two-thirds of all new FDA drug approvals have been for specialty drugs over the past several years, with many more in the pipeline. Advanced medical technologies are driving the demand for curative therapies, such as cell and gene therapies. Specialty drugs – while expensive – often offer the most effective and possibly only treatment for diseases that historically had few treatment options. Payers are closely scrutinizing these medications because of their high cost. Specialty drug manufacturers will need to work closely with payers and formulary decision-makers to prove the value their brands bring to patients and healthcare.
As pharmaceutical markets, pipelines, and policies continue to evolve, life science companies of all sizes need an agile and flexible approach to optimize commercialization. Commercialization strategies are highly complex, costly, and cumbersome to execute – learn how Phil can help your company here.
