Airbnb did it. Tesla did it. And an entrepreneur named Marc Lore who’s planning an inclusive, utopian city called Telosa may be next. Biopharma can do it, too.
Biopharma conquered monumental challenges introduced by the COVID-19 pandemic. But sustaining that progress now and into the future won’t be easy. It won’t be enough to settle in and be content with what the industry has achieved so far.
Here’s why: We have moved in the global health crisis from chaos to kairos, a critical moment in time to move past the pivot and capitalize on the momentum it has been driving. The force of present drivers and historic legacy is high, however, which is putting biopharma at risk of its own Kodak moment. The healthcare environment is primed for something better—to become a trusted partner instead of merely a supplier that leads innovation in the greater healthcare ecosystem—and hope is high.
Biopharma executives have questions: Are we back to normal yet? Which business practices still work? How am I positioned to compete when the earth below our feet is still shifting? The better question is: How much further do we need to go to win in the future?
The prospect of transforming strategy is not new. But today you can’t ignore the convergence of market forces and shifting human behaviors, together with emerging technological tools and policy changes, that make the need for heightened engagement so urgent. COVID-19 helped identify and, in some cases, correct shortcomings, but what we have done so far is not enough to build for what the future will bring. Taking on more change is biopharma’s best move.
To map a path forward, it helps to understand the pandemic-driven trends we see persisting over the long term.
Trend 1: The great healthcare reset won’t reverse. The pandemic shook this world to its very core, irreversibly changing the healthcare journey and making it more complex for all—not just how care is delivered or by whom but even where, as care keeps moving closer to the patient. Aftershocks loom as the terrain settles in ways no one could predict, giving rise to new behavior among patients and customers alike. Meanwhile, shifting priorities and emerging new business practices continue to widen the gulf between pharma and customers.
Social and structural factors influence 70% of health outcomes, according to the Physicians Foundation, and yet there is so much runway here to improve. The reset we’ve experienced has amplified the need for better socioeconomic data collection and integration with clinical workflows, new care delivery models for disadvantaged groups and reimbursement models for care providers.
Recovery is uneven, so far. While patient flow is mending—August 2021 patient visits were down just 6% from pre-COVID-19 levels—more than half of the practices ZS surveyed in our COVID-19 pulse research from Aug. 2021 reported staffing limitations and managing patient backlog as their biggest challenges.
The initial jolt to the healthcare journey led to backlogs and sicker patients, but it also pushed care closer to patients, making it more accessible via telehealth at home and nontraditional settings like microhospitals and community locations, setting roots for new habits to stick. Look at Canada, which is investing $11 billion (CAD) over 10 years to improve access to home and community care. This was a necessity during lockdowns and restricted travel, but we expect that patients will want to remain closer to home for convenience.
Some 58% of IDNs are now investing in additional sites of care including clinics, ambulatory surgery centers and long-term care centers, according to ZS’s Provider Organization Partnership Tracker survey of executives at 67 U.S. integrated delivery networks (IDNs). An additional 25% of survey respondents say they plan to invest in new sites of care in the future.
At the same time, consolidation continues to shift more power to organized customers, such as IDNs and health systems. In the past year alone, some 16,000 medical practices closed, and seven megamergers made headlines in the U.S. As IDNs and health systems grow more sophisticated and wield greater influence over the delivery of care, they are changing operations to better control cost and improve health outcomes. They demand no less from biopharma.
Trend 2: Hybrid is here to stay. Exacerbating the disconnect between pharma and the whole ecosystem is healthcare providers’ (HCPs) growing preference for both virtual and in-person engagement, whether in one-on-one or in group settings such as conferences. ZS experts project that 10% to 15% of HCP customers will opt for no-see or virtual-only interactions going forward, with 20% to 30% fewer sales rep visits overall than was the case pre-COVID-19.
Biopharma’s contact with HCPs—both remote and face-to-face—is still at roughly 80% of pre-pandemic levels, according to ZS’s Oct. 2021 AccessMonitor and COVID-19 insights report. Oncology rep activity lags further behind with recovery estimated at just 60% of pre-COVID-19 levels.
It’s not just about the sales channel, however. Fatigued, under-resourced and in need of support, HCPs expect greater value from every biopharma encounter their overbooked schedules permit, whether digital or in-person. A polished narrative from the most affable, charismatic sales rep is no longer sufficient to close a sale and cement long-term relationships. HCPs expect pharma companies to understand their specific pain points and offer customized, pragmatic solutions.
Anecdotal gripes from HCPs on virtual engagement include: reps “scheduling calls just to accomplish company targets for calls” and “repeated use of standard slide decks for sales marketing materials.” HCPs want pharma to meet them where they are. This is a new and significant shift.
Trend 3: Partnership opportunities are booming. Fallout from the pandemic is nudging both established players and emerging startups to partner in new ways to address healthcare’s most pressing issues.
The end of 2021 has brought approximately $30B in investments in digital health. A rise in vertically integrated digital options to support patients are gaining traction, and patients are, in many cases, opting for digital-first engagements. Biopharma has experimented with partnerships, building or buying digital health. But this remains an open playing field to advance products, engage in new channels such as e-commerce, further advance relationships with patients and defend biopharma’s ability to be part of their decisions at the right time.
Some partnerships in this vein are taking form, such as one between AstraZeneca and the nonprofit hospital Mass General Brigham. Both are collaborating to develop digital health technologies to gain better visibility to patients in the real world, beyond the clinical setting. “What we learned during the [COVID-19] surge was, we really don’t have time to continue to experiment,” Sara Silacci, director of strategic alliance initiative at Massachusetts General Hospital, said at an industry conference, according to MobiHealthNews. “So, identifying the right partners that we know how to work with and that share with us a similar sense of urgency and belief in digital health just became of paramount importance.”
Among IDNs polled by ZS, 67% said they are willing to team up with life sciences companies to address challenges specific to COVID-19, according to ZS’s Provider Organization Partnership Tracker. The potential is massive. While only 25% of IDNs are partnered today with pharma on innovative contracting initiatives such as value-based care, a whopping 61% want such collaboration in the future. Likewise, only 35% of survey respondents currently work with pharma on reimbursement support and policy shaping, and yet 55% say they are eager to do so.
Trend 4: Expectations have skyrocketed. Pharma’s reputation improved exponentially in the wake of COVID-19, thanks to the speed and quality heroics it accomplished with vaccine development and delivery. Pre-pandemic, a scant 32% of American consumers held a positive view of the pharmaceutical industry, but good feelings for pharma surged as high as 62% this year because consumers saw the industry working to prevent diseases rather than just treat them, according to Harris Poll’s COVID-19 Tracker.
But this phenomenon is arguably already waning, especially if biopharma does not address other important issues including efficient product development, inclusive and decentralized clinical trials, patient support and access and affordability.
The bar has been raised, and meeting new demands requires digitization to scale. Technology tools are increasingly available, given they were vital to keep trials running during the pandemic. ZS’s State of AI report shows that 43% of artificial intelligence (AI) and machine learning adoption in biopharma was geared to R&D as we entered the pandemic. Expect this focus to rise.
Blueprint for the biopharma of the future
So, what’s next for biopharma as it makes decisions about how to evolve and adapt to the state of healthcare as a result of the COVID-19 pandemic and its aftermath? There are three major implications that biopharma must act on today to reassess its strategy and the role it wants to play in the healthcare ecosystem.
Implication 1: Digitize, personalize, humanize. One starting point for this is to rethink drug development and clinical trial approaches. The vast majority (85%) of all trials fail due to non-enrollment or dropouts, yet trial numbers and costs are growing at a CAGR of 5.7%. The pandemic slowed patient recruitment for trials due to concerns around frequency of visits and risk of COVID-19 exposure. Patients surveyed by ZS say they’d be more likely to participate in trials if they better understood potential side effects and what was expected of them (26% of respondents) and if they were offered free medical care during the trial period (21%). Conveniences like medicine delivered to homes (25%) and the option to return test samples by mail (14%) are other big motivators.
Most biopharma leaders (93%) acknowledge virtual and decentralized trials are critical because they ease the patient burden and cut costs by half. Digitization is the enabler and the time to invest is now. In a clinical trials roundtable with top pharma companies, ZS leaders learned that two-thirds of leaders expect greater than 50% of trials to be hybrid or virtual in the next three to five years. Is your organization on the leading edge here?
Another area to focus this “humanized digitization” is in how biopharma continues to build solutions for HCPs. HCPs surveyed by ZS have voiced clear recommendations about how biopharma can help them: Provide evidence-based literature and compassionate care medications at discounted prices to patients; continue to offer adequate samples; deliver timely, relevant information and respond to HCP queries quickly. This is likely why we see more biopharma sales organizations adopting technology to deliver on HCPs’ rising expectations. Today, 79% of biopharma companies have invested in decision support tools to help sales teams drive positive, value-based interactions. But success comes from more than just the tools—it’s up to biopharma to hear what HCPs are asking for and to deliver quality interactions.
Implication 2: Overhaul your go-to-market strategy. Pharma’s traditional siloed approach that focuses on physicians more than others in the ecosystem can’t work much longer. That historic business model has outlived its utility. All signals point to quality over quantity, inclusion not exclusion, more pull than push. Engagement must deliver genuine value to all stakeholders and that means keeping a pulse on shifting priorities and behavioral patterns. Not periodically. Not quarterly. Continuously from here on out.
It’s not about scaling up or doubling down. This is biopharma’s opportunity to invest deeper in analytics and other technology enablers to capture insights that provide a 360-degree view of the healthcare ecosystem. By really understanding the customer, the impact of social factors on health, drivers of decisions and to anticipate variabilities as they are taking shape, biopharma can become an ally, a trusted partner.
Even if that is not your mission today, to be a partner you need to respond to the major shift to patient and digital engagement that the new normal has created. Patients increasingly have e-commerce and alternative site of care options that they are engaging with. A significant shift in focus, effort and capability is on the table.
And as you adapt, scrutinize content and messaging while engaging in digital channels and ask: Is this compelling? Does it tell a credible, longitudinal story over time, one that demonstrates biopharma is in tune with the needs of the greater community?
There are abundant opportunities to explore potential new partnerships, services, solutions, traditional medicines, nonmedicines and commercialized assets. Doing so requires a commitment to flexible business models, agile technology infrastructure and—most critically—a mindset that’s open to change.
Implication 3: Crawl, walk and run toward the future. It’s OK to crawl first. These are significant changes that will not happen overnight. One area for biopharma to run and potentially help lead is health equity. The pandemic irreversibly changed the landscape in ways that put biopharma in a great position to address this challenge from trial to long-term outcomes. Transformation calls for operationalizing health equity in R&D, in more inclusive clinical trials, in commercial planning, finding and mitigating bias influencing education and product development.
Kairos is here, now. We have a choice about how we will respond. Biopharma has an unusual opportunity to seize this moment and script its next chapter of its story rather than being written about by someone else.