By Ed Miseta, Chief Editor, Clinical Leader
Follow Me On Twitter @EdClinical
A new report from McKinsey & Company highlights why 2020, despite the COVID-19 pandemic, was a banner year for innovation in drug development, and why we should be optimistic for the future of the industry. The report, titled Biopharma 2020: A Landmark Year And A Reset For The Future, highlights 10 critical themes for pharma CEOs to consider as we move into 2021 and beyond.
There is no denying that 2020 was a watershed year for the industry. Despite the pandemic shutting down some trials and delaying others, much was accomplished. The report notes the industry progressed more in the last 10 months than it had in the prior 10 years. The biopharma industry has shown what it is capable of accomplishing when it works at its best. Companies that for years held back on implementing decentralized trials suddenly had them up and running in a matter of months. Trials continued, patients were kept safe from travel to clinics, and new technologies seemed to perform as advertised. So how does the industry build on that in the coming years?
There certainly seems to be no desire to eventually go back to conducting trials as sponsors did prior to the pandemic. Pharma has shown it can quickly adapt to a changing situation and that will be expected in the future. A good number of patients will not want to return to regularly scheduled visits to clinics. Many working in the industry have already made a vow to support #NoGoingBack to the old ways. In one way or another, all companies will have to embrace this new way of doing business if they want to ensure future success.
Below are the 10 areas where McKinsey & Company believes sponsors can best differentiate themselves.
1. Harness The Power of Science
In 2020 the entire world turned to the life sciences industry to produce treatments and vaccines for COVID. Thus far the industry has not disappointed, churning out two vaccines before year end with more in development. The McKinsey report notes the scale and pace of global mobilization effort demonstrated what the industry is capable of achieving when operating at its best. It also reminded the world of the core purpose of the industry: Saving lives. Although the reputation of pharma has been poor in recent years, the results delivered in 2020 has generated a more positive view of the industry in 70 percent of Americans. One challenge to CEOs will be maintaining and strengthening that sense of purpose and mission.
2. A New Model For Drug Development
In 2020 it took pharma just nine months to map the COVID-19 genome and produce and roll out the first vaccine. Patients who saw that speed in action will not want to go back to drug development timelines of 8 or 9 years. That will challenge pharma organizations to adapt a new model that hastens the development process. McKinsey notes many companies are experimenting with ways to accelerate trials by 500 days or more. Doing so will require them to engage more closely with regulators, patients, payers, and each other. An accelerated timeline will also require them to more thoughtfully deploy the many digital and analytical tools they implemented in 2020. Patient centricity, which has been discussed in the industry for years, will be front-and-center. All available tools must be used to redesign trial protocols and the patient experience. For companies truly wanting to become a sponsor of choice to sites and patients, the coming years could be the time to step to the head of the class.
3. A Surge In Digital, Data, and Analytics
The use of digital technologies soared in 2020. Digital ecosystems quickly evolved as well as the use of digital channels to engage with physicians and principal investigators. Some firms had efforts underway prior to the pandemic, but COVID certainly increased the sense of urgency. The challenge now will be in moving from those initial implementations to prioritizing efforts and Future success will involve creating a visible impact across the enterprise. The McKinsey report notes the disruptions experienced in 2020 has companies revisiting their go-to-market models and making greater use of predictive analytics and real-world evidence (RWE). Future success will require bringing together technology, capabilities, and change management.
4. Investing in Enterprise Technology
The changes that took place in pharma in 2020 were enabled by technology. Investing in new technologies will need to be a continued focus for companies. The lessons learned during the pandemic should continue to shape IT plans as leaders embrace the technologies they will need for future success.
5. Scaling Up The Next Wave of Innovation
COVID-19 vaccines were developed at astonishing speeds and McKinsey states those efforts stand in stark contrast to historical development timelines in the industry. mRNA, as well as cell and gene technologies, will play a role in helping patients with unmet needs. Drug developers will need to determine how quickly and aggressively they will shift portfolios towards these game-changing opportunities.
6. China’s Growing Importance in Opportunity and Innovation
McKinsey notes corporate confidence in China remains strong. The country has projected economic growth of eight percent in 2021. In contrast, Europe is expecting economic contractions of 11 to 12 percent. The company is also playing a significant role in innovation, with 19 assets submitted in the last 12 months for review by the FDA, and in-licensing by U.S. and European companies. McKinsey notes the pace and scale of change has been significant, with the market cap of biotech companies on the Hong Kong and Shanghai stock exchanges rising from $12 billion in 2017 to $217 billion in December 2020. Drug developers in the U.S. will need to decide the extent to which they should take part in that innovation.
7. Leveraging Partnership as a Competitive Strength
McKinsey notes navigating the pandemic in 2020 proved the value of partnerships. Numerous pharma companies have noted innovation does not come entirely from within its own walls, and now is the time to think more broadly about collaboration. The report recommends sponsors consider future partnering opportunities, adopt new models for peer-to-peer collaboration, and participate in ecosystems such as the growing healthtech market.
8. Shape a Compelling Environmental, Social, and Governance (ESG) Agenda
ESG was a concern for companies prior to COVID and is more so now. For example, McKinsey notes 40 percent of global assets are now managed through sustainable strategies. But the COVID crisis also shined a bright light on the inequalities that exist in our society. Some minority groups and Americans with low incomes have more limited access to medical care and were more likely to get infected with the COVID-19 virus. The situation has caused the emergence of health equity as a topic in C-suites and boardrooms. From energy and resource use to access to medicines and diversity in clinical trials, ESG will continue to be a topic of discussion.
9. Prevent Future Healthcare Crises
In 2020 the world was reminded that healthcare emergencies can quickly turn into a crisis. In the last 20 years we have seen the outbreak of five infectious diseases that carried the risk of pandemic. Organizations around the world will require the ability to address new outbreaks as well as well-documented endemic diseases. Managing these diseases and outbreaks will require collective engagement with regulators, governments, payers, and multilateral organizations.
10. Rethink Talent and Leadership
In 2020 the pandemic forced many companies to convert to remote work for employees, embracing flexible forms of working, and instilling more agility in decision making. Those adjustments will continue to play a role in how businesses operate in the future. The McKinsey report notes the role of HR officers has never been broader, as they are helping companies embed new ways of working. Recent research from the McKinsey Global Institute found more than 60 percent of management, technical, and scientific roles could be performed remotely. That alone will force executives to focus on a host of new questions, including how to offer employees the best balance between time in office and working remotely. They must also consider how to protect the organization’s social fabric when a physical presence in no longer required.
The entire McKinsey report, Biopharma 2020: A Landmark Year And A Reset For The Future, can be accessed here.