Category: Healthcare & Life Sciences

The Changing Face of the CRO: Becoming the Everything Store for Decentralized Trials | Blog

On February 24th, 2021 we saw an announcement of one of the largest mergers/acquisitions that the CRO space has ever witnessed. ICON, the Dublin-based global CRO, announced that it has entered into a definitive agreement to acquire rival North Carolina-based PRA Health Sciences in a deal valued at US$12 billion. The deal, which makes the combined entity the second-largest CRO, next only to IQVIA (itself a merger of IMS Health and Quintiles), is one of the many instances of the rapidly consolidating CRO industry, accelerated by COVID-19.

Pushing the gas on decentralized trials

While there are a lot of potential synergies in this acquisition, such as minimum overlap in terms of geography, deeper therapeutic capabilities, and broader service offerings, one important takeaway from this acquisition echoed by Dr. Steve Cutler, Chief Executive Officer of ICON, is the shift towards Decentralized Trials (DCTs).

With decentralized trials gaining importance, thanks to the pandemic, there has been an increasing focus from CROs to shore up their capabilities and develop an integrated solution. For instance, Bioclinca and ERT recently announced a merger that enabled the combined entity to provide holistic solutions in eCOA, imaging, and clinical trial management solutions. ICON, through this acquisition, has set out to achieve an integrated offering in DCTs as well. It seeks to combine its home health services, site network, and wearables technology with the mobile health and connected health platforms and other real-world data solutions from PRA Health Sciences.

Becoming the everything store for decentralized trials

Traditionally, a CRO was considered a business process service provider, managing trial operations in regulatory, safety, and clinical conduct. Very few offered technology solutions along with business process services as this was often considered the forte of product vendors such as Oracle Health Sciences and Medidata. However, with the pandemic halting clinical trials, stakeholders analyzed how to restart paused clinical trials by virtualizing certain components of the trials through some short-term fixes, such as use of eConsent and eCOAs solutions, resulting in an uptick in DCTs.

Initially, partnerships had been the preferred route for CROs to support DCTs, for example, the Covance partnership with Medable wherein Covance’s patient and site interface would be powered by Medable’s DCT offerings. However, the recent M&A activity suggests that CROs are now considering adding product capabilities to enable DCTs by acquiring product players (such as what Bioclinica did with ERT) or by acquiring CROs with strong technology capabilities to support such trials (such as ICON and PRA Health Sciences). The result – offering a one-stop-shop solution to support DCTs, as highlighted in the visual below.

Figure 1: A one-stop shop solution for supporting decentralized trials

A one-stop shop solution for supporting decentralized trials

The advantage of such an integrated solution is that it augments the CRO’s value proposition to conduct DCTs – integrating platforms, services, site networks, and data capabilities, all into one place. Such CROs can now provide patient recruitment, engagement, and retention services (which has traditionally been their stronghold) using the underlying DCT suite through which the patient can enroll, record clinical outcomes, and engage in video consultation with the doctors/physicians. Additionally, they can also provide auxiliary support services, such as the provisioning of devices used for remote patient health monitoring and offering home nursing services aimed at reducing or eliminating patient visits to trial sites, medical record review services to check for completeness, accuracy, and compliance of medical data, and remote CRA services to oversee the DCT.

Implications for CROs

While, at first, the advantages of an in-house DCT suite seem to improve the value proposition for the CRO, it is also pertinent to note that in this scenario, CROs are also competing directly with DCT product vendors such as Medable and Science 37. The key challenge for CROs would be in convincing clients who still hesitate, while adopting technology offerings given their business process services heritage.

CROs aiming to walk down the acquisition path should keep the following pointers in mind:

  • Innovate or perish: CROs would be competing directly with product vendors – an industry notorious for innovation. Investments aimed at improving the product quality, product enhancements, and fixing issues would be critical to win client trust
  • Incorporate success stories: Showcasing client success stories and case studies will reduce client hesitation to adopt the one-stop DCT solution and drive increased product uptake
  • Offer innovative commercial constructs: Traditional ways of contracting (for example, per study or volume-based constructs) may not work with DCTs. While offering clients a BPaaS construct, check for risk-sharing agreements as clients appreciate vendors who showcase skin in the game

Looking into the crystal ball

The DCT space is ripe for disruption and the string of M&A activities shows the increasing emphasis that CROs are putting on DCTs. As efforts to improve the value proposition intensity and innovation ensue, the industry can expect more tuck-in acquisitions and even some mega-mergers, such as ICON and PRA Health Sciences, to continue well into the future. What are your thoughts on this? Let us know at [email protected] and [email protected]

Amazon HealthLake: A Step Further in AWS’ Healthcare Strategy | Blog

It’s been close to a month since Amazon Web Services (AWS) announced Amazon HealthLake at its 2020 annual (and virtual) conference. After observing the reactions from various industry participants, we thought it was time to offer our opinion.

Amazon HealthLake is a HIPAA-eligible service that aims to support interoperability standards and further drive the use of big data analytics in healthcare and life sciences. The service is essentially a data lake tailored for the healthcare and life sciences industry. It will aggregate an organization’s data across various silos and disparate formats into a centralized AWS data lake, and automatically normalize this information using machine learning. It will be capable of identifying each piece of clinical information and tagging and indexing events in a timeline view with standardized labels so they can be easily searched. This structured data can then be offloaded to a service such as Amazon SageMaker to train machine learning models for advanced analytics. HealthLake will also structure all the data into the Fast Healthcare Interoperability Resources (FHIR) industry standard format to enable data sharing throughout the organization.

Exhibit 1: Amazon HealthLake

Amazon HealthLake

Source: AWS (https://aws.amazon.com/healthlake/)

What’s in it for the healthcare and life sciences industry?

This is definitely a positive step for AWS to showcase an industry-specific solution for its clients and prospects. Amazon HealthLake provides a contextualized solution for addressing some critical challenges the healthcare and life sciences industry is facing, namely working with siloed, unstructured, and incomplete data stored across multiple systems, lab reports, medical images, insurance claims, and time-series data (for example, heart ECG or brain EEG traces.) Putting data at the center of the business allows the development of innovative products and services and provides the opportunity to revolutionize business models. AWS’s approach enables healthcare industry professionals to focus on mission-critical activities while it manages the data complexity.

Some of the key use cases for HealthLake include:

  • Payers – HealthLake will help health insurance companies predict more accurate insurance premiums, design data-driven insurance policies, and carry out effective claims management by bringing together a complete view of a patient’s medical history.
  • Providers – Healthlake can integrate with other AWS machine learning and analytics services, like Amazon SageMaker and QuickSight, to improve efficiency and reduce hospital waste. Some of the core use cases include population health management, clinical decision support, revenue cycle management, scheduling optimization, reducing unnecessary procedures, and addressing privacy and security requirements.
  • Pharma/Biotech – Clinical researchers are struggling with ever-increasing volumes of data from trial sites, patients, CROs, and other vendors, as well as from newer resources like EHR and wearable technology. HealthLake can help life sciences enterprises revolutionize data-driven R&D, advance clinical research with predictive analytics, and enhance pharmacovigilance.

HealthLake fits perfectly in Amazon’s data-hinged healthcare strategy

Amazon is aiming to transform healthcare by putting a well-developed range of integrated technology solutions supported by a second-to-none data asset, similar to its disruptive approach in the retail industry with low costs, high customer convenience, and a great recommendation engine. A key prong of its strategy is healthcare cloud computing, as payers, providers, and life sciences enterprises adopt more cloud computing services to stay on top of the rising volume of patient data.

Amazon HealthLake is another sign that AWS views healthcare as an industry with massive growth potential for its cloud services. AWS has been steadily rolling out HIPAA-eligible computing tools over the past few years in a race with Google Cloud and Microsoft Azure as the industry cloud war intensifies in the nascent healthcare cloud computing space. ​In 2019, the company announced Amazon Transcribe Medical, a voice transcription service for physicians that inputs text directly into medical records. In 2018, it introduced Amazon Comprehend Medical, a service that uses AI to mine medical records for information that can be used to improve patient treatment and reduce costs.

While AWS’s long-term strategy for healthcare is anyone’s guess right now, it will certainly be an interesting player to watch as well as an exciting one to partner with and compete against.

It’s Time for IT Operating Model Transformation in the Medical Device Industry | Blog

As the world is working to contain the spread of COVID-19 through safety measures and vaccine development, the medical device industry also is starting to show signs of recovery from the pandemic’s impact. The decline in elective procedures hit medical device organizations’ revenue hard in the first half of 2020. But increasing demand for COVID-19 diagnostic tests is stabilizing growth and compensating for the negative impact on routine testing procedures. To support growth dynamics and ensure a stable recovery, initiatives focused on cost reduction and operating margin optimization are the top priorities for most medical device organizations. For example:

  • Stryker is looking at organization-wide cost transformation for better margin expansion.
  • Medtronic announced its restructuring plan to save up to US$475 million per year.
  • Baxter expects to achieve an operating margin of 23-24% by 2023 through cost optimization.

 How can IT operating model transformation help?

To achieve significant cost savings, medical device companies need to scale their digital transformations to reap maximum benefits, which mandates IT operating model transformation. Based on a recent survey we conducted with 200 CXOs, 80% of firms that adopt an IT operating model transformation believe they’re on their way to establishing market leadership in their respective industries, expanding to serve new market and customer segments, and achieving over one-and-a-half times more cost savings than those that haven’t initiated a similar transformation. An enterprise-wide IT operating model transformation could help medical device companies realize cost benefits and maintain a competitive edge in the market.

Yet, according to our 2020 research, nearly 78% of enterprises fail to implement their digital transformation as envisioned.

What are medical device companies doing wrong?

Most medical device companies that are transforming IT achieve success in running pilot projects but fail to realize the same impact across the breadth and depth of their enterprises, because they equate IT transformation with either technology overhaul or operating model transformation, instead of pursuing them together. Exclusively focusing on technology transformation fails because it is a siloed approach that relies too much on technology without integrating the necessary operating model changes. On the other hand, changes in only the operating model result in superficial restructuring of business units that are focused on driving tactical and incremental efficiencies, eventually leading to a plateau phase. Clearly, companies need to embrace a balanced focus on both technology and operating model transformation to scale and sustain the transformation benefits.

What’s the best approach to IT operating model transformation?

The exhibit below is a framework that outlines the strategy and solution elements that enable an IT operating model transformation. Medical device companies can leverage this framework as a blueprint to design a holistic, best-in-class approach across both strategy and solution design.

Everest Group’s Target IT Operating Model Framework

Everest Group's Target IT Ops model framework

When creating the strategic roadmap, medical device enterprises should articulate a vision statement that ties together both business and IT objectives, and also carefully consider how to communicate the vision across the organization. Building an adaptable and agile organization that is resilient and collaborative is instrumental in this long journey, as 70% of enterprises believe organization structure is a barrier to scaling digital initiatives. Furthermore, effectively resourcing the IT operating model transformation and monitoring performance through cross-functional, outcome-based business metrics are keys to its success.

To complement the well-defined strategy with a strong solution framework, medical device companies should establish a strategic partner ecosystem with a fit-for-purpose portfolio of vendors. Traditional IT sourcing partnerships with a cost-centric model should evolve to a value-adding, strategic model focused on driving innovation and enabling business value. To truly scale the digital transformation and break up siloed investments, they should identify strategic partners that will equip them with the right talent, and scale the adoption of relevant next-generation technologies, so that – together – they can drive innovation with a common objective of achieving the defined vision.

As medical device organizations embark on their IT operating model transformations, we suggest a three-stage approach:

  • Lay out the building blocks by painting an organization-wide vision and introducing the agile way of working by building integrated multidisciplinary teams.
  • Enable the IT organization with the right solutions to become a business value orchestrator.
  • Scale the impact by synchronizing effects across solutions and constantly monitoring progress through well-defined business metrics.

Please share your views on IT operating model transformation with us at [email protected] and [email protected].

BioClinica and ERT to Merge: Perspectives on Potential Synergies | Blog

On December 10, 2020, ERT, a clinical end-point data solutions company, announced its merger with BioClinica, a clinical trial management and imaging solutions company. The goal of the resulting enterprise will be to integrate the best of both worlds – ERT’s expertise in electronic Clinical Outcomes Assessment (eCOA), therapeutic expertise in cardiac safety and respiratory, and clinical endpoint measurement through wearables, with BioClinica’s expertise in imaging and clinical trial management solutions. The merger will equip the combined company to deliver data analytics, insights, business intelligence, virtual patient visits, and technology solutions to its clients.

In analyzing this development, we’ve taken a look at the hottest topics in the life sciences industry right now – decentralized and virtual clinical trials.

Virtual clinical trials – a revolution catalyzed by the pandemic

A virtual clinical trial is one in which certain parts of the clinical trial are conducted outside a clinical site, such as patient consent capture, trial data capture, or patient monitoring through sensors or wearables. The benefits to the pharmaceutical company include cost savings, better patient recruitment and retention, and improved data quality.

Earlier this year, we published a blog predicting that the 2020s would be the decade of virtual trials. It seems we were way off the mark – by about nine years. The year 2020 has already seen its fair share of virtual trials, as clinical trials that were put on pause due to lockdown restrictions were rescued by being converted to fully virtual or hybrid trials, such as cases in which clinical experts visited patients at their residences to collect vitals or samples, reducing delays.

#NoGoingBack

The virtual trial momentum isn’t temporary, and there’s increasing focus on virtual trials, even among investors. Not only this, many in the industry have pledged to preserve the progress they’ve made in clinical research due to the pandemic, including virtual trials.

On the same day the news of the merger was announced, the Decentralized Trials & Research Alliance (DTRA) was formed to unite stakeholders with a mission to make clinical trial participation widely accessible by advancing policies, research practices, and new technologies in decentralized patient-focused clinical research. Companies that are part of this alliance include technology vendors such as Medidata Solutions and Oracle Health Sciences, pharma companies such as Pfizer and Roche, CROs such as Parexel and Syneos Health, and others such as Amazon and the US Food and Drug Administration.

M&A and investment activity has increased, too. For example, Medable and Science 37 each received funding during the pandemic to advance their virtual trial offerings. And in November 2020, VirTrial, a telehealth platform for managing decentralized and virtual clinical trials, was acquired by Signant Health, a Clinical Trial Management System (CTMS) vendor, thus augmenting its virtual trial capabilities.

Clearly, virtual trials are a ripe area for M&A and investment activity given their disruptive capabilities and benefits. And we continue to expect more acquisitions, funding, and collaboration in this space in the near future.

What this all means for the merger

Our recently concluded PEAK Matrix assessment on clinical development platforms pointed out that BioClinica’s Cloud platform for clinical development does not have the capability to support virtual trials; we said it needed to invest in remote monitoring and eCOA capabilities to deliver on virtual trials. However, the solution does have a broad set of capabilities in the clinical, regulatory, and safety value chains.

As a result of the merger, however, BioClinica will be able to offer virtual trial capabilities to clients. ERT is one of the leading eCOA providers and through its wearable and sensor data capture capabilities, it is well positioned to conduct virtual trials in certain therapy areas. And it will be able to use the BioClinica Cloud offering to give clients a holistic clinical development experience, a win-win-win for ERT, BioClinica, and their clients.

Exhibit 1 shows the combined solution landscape.

Exhibit 1: The merger synergies

bioclinica

The merged entity will be able to showcase an end-to-end clinical development platform with enabling layers for virtual trial conduct. This move is definitely the right direction, at the most opportune time, and is just another sign of increasing interest in decentralized and virtual trials.

What are your views on this merger? Let us know your thoughts at [email protected] and [email protected].

Clinical Development End-to-End Platforms: Are We There Yet? | Blog

As part of our research for our recently published Clinical Development End-to-End Platforms – Vendor Landscape with Products PEAK Matrix® Assessment, we noted a distinct accelerating trend: product vendors are increasingly branding products end-to-end clinical development platforms. Product vendors are consolidating all of their clinical development point solutions into a unified platform: Accenture INTENT, Cognizant Unified Clinical Platform, IQVIA Orchestrated Clinical Trials, Medidata RAVE, Oracle ClinicalOne, TCS Advanced Drug Development (ADD) platform, and Veeva Vault are all being pitched to clients as end-to-end clinical development platforms.

Definition of a clinical development end-to-end platform

An end-to-end clinical development platform includes all of the solutions necessary to perform clinical/safety/regulatory activities with unified data layers that ensure the data is in sync, rather than in siloes. Exhibit 1 is our view of an end-to-end clinical development platform, which consists of digital touchpoints that allow various users access and support core modules to perform clinical startup, conduct, and closeout; regulatory; and safety activities. It also includes tenets that make it a platform, such as modularity, scalability, interoperability, and supporting a unified data integration layer.

Exhibit 1: Everest Group’s view of an end-to-end clinical development platform

end to end clinical development platform

Pharma enterprise view of an end-to-end clinical development platform

Spoiler alert: Pharma enterprises aren’t convinced.

The potential benefits that vendors tout include fewer data silos, lower total cost of ownership, and a rationalized product landscape, which reduces the need for integration and custom development activities.

We agree that these are pretty solid business cases for adoption. Except, pharma executives don’t believe it. Through interviews with 25 pharma stakeholders engaged in clinical development and buyers of clinical trial products, we found that an astonishing 92% aren’t convinced that an end-to-end clinical development platform currently exists. And that presents the next big challenge – only 28% of these organizations would opt for an end-to-end platform if it existed.

The reason? Credibility.

These buyers say that, though the vendors are marketing products as end-to-end platforms, they believe the platforms lack functionality such as modularity, a unified data layer, or interoperability even within their own suite of solutions. They are yet to be convinced about the RoI of adopting such a platform. Buyers further say that most vendors struggle with a support services organization that’s in line with the unified platform view. That means that the support organization is still organized in silos, and the platform users would still have to contact individual solution proof of concept individuals with issues they need solved, thus diluting the benefits of a unified platform.

Other challenges buyers cite include:

  • A preference for a best-of-breed approach: Buyers prefer established leaders for individual components, as they don’t believe that a single vendor is considered best-in-class across the clinical product suite.
  • Maturity: End-to-end platforms are relatively new, and buyers lack conviction about their functionality.
  • Aversion to rip and replace: Buyers are resistant to change and hesitant to replace existing, well-performing systems with a new system.
  • Existing long-term commitments: Some pharma enterprises already have long-term commitments with their current clinical product vendors, which deter adoption of a single-vendor system.

So, how do product vendors drive adoption of an end-to-end platform?

Clearly, convincing buyers to adopt an end-to-end platform is going to be an uphill challenge. To drive adoption, vendors need to embrace a multi-pronged approach:

  • Build from the ground up: Vendors need to realize that simply taking existing point solutions and connecting them together to form an end-to-end platform won’t work. Rather, building one from the ground up will greatly enhance interoperability, offer ease of use, and improve user-centricity.
  • Build business cases: Vendors need to create success stories and case studies for a platform-led approach to help influencers build a business case for adoption. The articulation of business benefits, future technology roadmaps, and showcasing testimonials will move the conversation on end-to-end platforms.
  • Co-innovate: Invest in building relationships by exploring improvements in platform capabilities and user centricity, while striving for interoperability, flexibility, and modularity to help drive adoption.
  • Find innovative commercial constructs: Pivot the pricing options to risk-sharing or outcome-based constructs. Also, given that the needs of big pharma are different from small and mid-sized pharma, consider differentiated commercial constructs to increase reach.

Driving change takes time. And because enterprises are change averse, they’ll need a lot of convincing before they can start to think seriously about adopting a single platform for all their clinical development needs.

In your opinion, what will it take for the industry to move the needle toward end-to-end clinical development platforms? Please reach out to us with your views at [email protected] and [email protected].

Health Insurance Open Enrollment Period (OEP) 2021: Key Changes, Challenges, and Opportunities | Blog

“It is not the strongest of the species that survive, nor the most intelligent, but the one most responsive to change.” – Charles Darwin

Charles Darwin’s famous words aptly describe what healthcare payers need to do in the times of COVID-19. The pandemic’s disruptive nature has forced the industry to accelerate adoption of many concepts –  such as telehealth – that had earlier been considered at least half a decade away from becoming mainstream. The changes that the US Centers for Medicare and Medicaid Services (CMS) has proposed for the health insurance Open Enrollment Period (OEP) 2021 are a clear indicator of these transformative times. The objective of these changes – such as the expansion of telehealth coverage, more transparency through regulations such as the Interoperability and Patient Access rule, and changes in risk adjustment / star ratings calculations – is accelerating the CMS toward its goals of universal coverage, transparency, member satisfaction, interoperability, and resilience.

As the OEP is a time when healthcare payers strategize about how to increase their enrollment numbers (in the short term) and achieve operational and business transformation (in the long term), it is imperative that payers not only understand the upcoming changes but embrace them through the right investments. OEP 2021 becomes effective November 2020, so healthcare payers are in the midst of the planning season.

In this blog, we take a look at the key changes CMS has proposed for OEP 2021 and analyze their impact on healthcare payers.

Exhibit 1: OEP 2021 proposed changes

Key changes suggested by CMS for OEP 2021

The impact of CMS-proposed changes on healthcare payers

CMS’ recommended changes for OEP 2021 are likely to impact healthcare payers in multiple ways:

  • Shift in membership and profit pools: The change in healthcare payers’ membership bases due to factors such as rising unemployment (which has reduced the employer-sponsored plan base) and the enrollment of End-stage Renal Disease (ESRD) patients in Medicare Advantage (MA) plans is likely to increase healthcare payer costs.
  • Member transparency and control measures: OEP 2021 has a slew of changes aimed at ensuring transparency through data sharing with members/patients via APIs and third-party apps. These changes include mandating the use of Real Time Benefit Tools (RTBT) for Part D plans and rules requiring plans to disclose the measures used to evaluate network pharmacy performance. It is clear that the CMS wants health plans (particularly MA Part D in this case) to invest in technology, data sharing, and reporting to enable the next phase of member-centricity in healthcare.
  • Medical Loss Ratio rebates support: Administrative Loss Ratio (ALR) / MLR has always been a pain point for healthcare payers, as an unfavorable ratio implies refunds and complex readjustments. With the CMS offering some rebates to payers in terms of how they calculate MLR, payers are likely to invest in improving care delivery initiatives.
  • CMS reporting dilemmas: With the CMS pushing healthcare payers to share actual member/patient experience data for Star Ratings and Risk Adjustment score calculations, healthcare payers will need to invest more in member satisfaction.
  • Shifts in health plan benefit inclusions: Telehealth services are only one set of inclusions that payers need to think about incorporating in plan benefits. Many other areas merit attention, such as member support, personalized communications, reorganization of provider network, and plan tiering.

How can payers navigate the changes and what are the likely sourcing implications?

While OEP 2021 is just another milestone for the CMS to drive healthcare efficiency, it is also notable that the changes are happening in the backdrop of the COVID-19 pandemic. The timing presents healthcare payers with both challenges and opportunities. In fact, industry experts believe that if ever there was a time for payers to change, it is now. This means that payers need to prepare strategies quickly to navigate the CMS-proposed changes, as well as changes arising from the COVID-19 disruption. The strategies will, in turn, lead to changes in their sourcing practices, thereby creating opportunities for outsourcing them to service providers.

Exhibit 2 lists the strategies that, we believe, healthcare payers will adopt in the coming months and the sourcing implications for each of them.

Exhibit 2: Payer mitigation efforts and sourcing implications

Payer mitigation efforts and sourcing implications

For the outsourcing and third-party vendor community, this is the right time to help mitigate the impact of OEP 2021 and the pandemic on healthcare payers. Service providers should align their offerings with payer needs.

If you’d like to know more about OEP 2021 and its wide-ranging impact, please read our recently published viewpoint Open Enrollment 2021 Primer: What to Expect and How to Navigate in the Wake of COVID-19. You can also reach out to me directly at [email protected] if you have any questions or observations.

The Teladoc-Livongo Merger: US$18.5 Billion Deal Heralds Virtual Care’s Breakout Moment | Blog

The Blockbuster Merger

The August 5, 2020, announcement of the US$18.5 billion mega-acquisition of Livongo – a chronic disease management company – by Teladoc – a multinational telemedicine and virtual healthcare company – rocked the virtual healthcare industry with seismic shockwaves.

Both companies had posted strong revenue growth before the acquisition. Teladoc’s revenue grew by 85% (or US$241 million) in Q2 2020. In the same quarter, its visits rose by more than 200% YoY to 2.8 million. Livongo’s revenue for the quarter grew by 125% YoY, bringing it to $91.9 million, with enrollments increasing 113% YoY to reach 410,000 members. The merger results in one of the world’s largest virtual health entities, with a combined valuation eclipsing US$37 billion.

The Mutual Strengthening

The importance of telehealth in a pandemic-stricken world became evident as the crisis overwhelmed providers (as it did other businesses), forcing many to close and postpone nearly all elective, low priority, and non-emergency appointments. To address ongoing health challenges, a significant portion of care provision shifted to virtual models, bringing companies like Teladoc to center stage. Digital healthcare and virtual health have since had an unprecedented surge in interest, investment, and adoption around the world.

The Teladoc-Livongo merger strengthens many facets of virtual healthcare delivery, which could benefit healthcare providers/facilities and patients. It is also evidence of the ever-growing complexity of engagements and constructs shaping virtual care.  The resulting organization will be able to realize multiple benefits given synergies between the two companies:

  • Teladoc will benefit from Livingo’s analytics prowess, which is delivered through its Applied Health Signals offering. The strong fundamentals of the data-driven approach underlying Livongo’s behavioral change and chronic management offerings can enable Teladoc to add significant value by layering its existing products with the acclaimed technology to provide its patients with tailored, efficient, and effective programs.
  • Livongo’s patient base will have access to a larger pool of healthcare professionals, who can provide more in-depth care and help diagnose and care for other ailments beyond the current set of offerings. The additional medical practitioners from multiple clinical specialty areas will enhance care delivery, improve options available to patients, enable access to a wider set of services, and eventually improve healthcare outcomes.
  • Patients will have access to a more integrated and comprehensive care experience given the expanse of virtual care segments the combined entity will offer.
  • Beyond the expanded pool of care professionals, both companies bring their own partnerships with health plans, employers, and other care-specific partners to the relationship, providing significant cost and coverage benefits to existing and future enrollees.
  • The combined entity will be able to increase its global footprint and benefit from cross selling services to an expanded client base, especially at a time when the adoption curve for virtual care is at the precipice of significant growth.

The Road Ahead

The era of digital health has been long coming, and the COVID-19 pandemic has only exacerbated the need for virtual care. This merger sets the stage for future growth, particularly in areas such as remote patient care, remote monitoring, remote diagnostics, digital-led triaging, digital therapeutics, self-care, and others that will revolutionize the care experience.

The industry has crossed an inflection point beyond which lies an extremely dynamic and unpredictable path, which requires healthcare entities to stay nimble, rethinking care models and care delivery through remote technologies. Healthcare payers and providers must quickly adapt to the shifting landscape and adopt the necessary digital means to stay competitive and become competent.

To find out more about the growing interest in and adoption of telehealth services, see our report Unpacking the Rise of Telehealth and reach out to [email protected] with your thoughts.

Data Monetization in Healthcare | Blog

A form of monetization, data monetization refers to the use of an organization’s data as an economic asset to reduce costs and increase business value. Organizations can monetize their data by providing third parties data access, commonly referred to as direct monetization, or by using the insights derived from this data to improve their internal processes, known as indirect monetization.

One industry that has seen an exponential rise in data in recent years due to increasing digitalization is healthcare. Health records are increasingly moving to the cloud, and the use of wearables and smartphones has become almost ubiquitous. This digitalization has paved the way for data monetization in healthcare, and it is helping not only to improve clinical services but also realize financial benefits. A strong integration of data with technology is set to revolutionize value-based care and personalized medicine and introduce better care outcomes.

Let’s take a closer look at how data monetization, particularly direct monetization, works in healthcare.

Bilateral data exchange – Among the earliest data monetization models, bilateral data exchange enables organizations to sell their data to one or more parties. It has experienced high adoption over the years, but its scope for disruption is limited, as single entities become data owners, and there is no data-based innovation at an industry level. Such data exchange is also mired in controversy, as highly sensitive patient data flows freely between organizations.

A case in point is the deal inked between Google and Ascension in November 2019 to provide Google access to millions of Americans’ health records. It came under the US Department of Health and Human Services’ regulatory scanner just 48 hours following its announcement.

Open platforms for data exchange – In this model, data providers can sell their data to platform owners, while enterprises can test their innovations using the platforms. The platform owners become data custodians in this case. This model has high potential for disruption, as it facilitates industry-wide collaboration for data transfer. It is gaining popularity among innovators, researchers, and academic institutions for early-phase testing of new products.

Mercy Technology Services’ (MTS) Real-world Evidence (RWE) network is one such open platform. MTS combines large data sets generated by health systems with advanced analytics, and provides insights for thousands of medical products that make it to the market every year. The RWE network allows medical product firms to test their products in real-time and providers to test their clinical decisions to offer better patient care.

Open marketplaces for patients to sell data – The most controversial aspect about data monetization is the sale of patient data without obtaining patients’ consent. Patients are the ultimate owners of their health data, and thus it is highly debatable whether large organizations should be allowed to make money by selling or buying this highly confidential data.

Open marketplaces for patients allow them to directly sell their health data to any party interested in buying it. Open Health, for example, has launched a platform that allows patients to monetize their health data by connecting companies or research institutions with people who fit the criteria for different studies or analytics. Users can share their health records with pharmaceutical companies, health systems, and insurers for a fee. This model is gaining popularity due to secure data exchange practices, and as it helps resolve the ownership and privacy concerns accompanying other models

Open marketplaces for data exchange – In such marketplaces, data providers can sell data, while interested entities can find and access relevant data. The seller retains the ownership, and buyers simply obtain the permission to subscribe to this data. This model serves as a bridge between organizations that possess a significant amount of healthcare data and those that need it. Amazon Web Services (AWS) Data Exchange is one such open marketplace that allows AWS customers to browse through and purchase a variety of data sets offered by data sellers

In our opinion, this model has the highest potential to disrupt the data monetization market in the coming decade, as it facilitates industry-wide collaboration for data asset exchange.

It is, thus, amply clear that in their quest for data, organizations can’t afford to ignore the need to ensure data privacy. The US Health Insurance Portability and Accountability Act (HIPAA) establishes national standards to protect individuals’ medical records and other personal health information. It applies to health plans, healthcare clearinghouses, and healthcare providers that conduct certain healthcare transactions electronically. The debate around data privacy is likely to get fiercer in the coming years, and only data monetization models that can address this challenge are likely to succeed.

What has been your experience with data monetization? If you’d like to discuss your experience or data monetization and how it applies in healthcare, please reach out to [email protected] or [email protected].

 

How the COVID-19 Pandemic is Impacting Pharma Sales Interactions with Healthcare Providers | Blog

With the world facing an unprecedented health crisis, one group shouldering the brunt of the challenge is our healthcare workers, who are battling the threat from the front lines. Under the circumstances, their interactions with pharma sales representatives have naturally taken a back seat, with many healthcare providers closing down access. This reality is accelerating pharma firms’ shift toward a virtual sales organization, and not only for the short term.

The amount of time, access, and influence hospitals have been willing to grant pharma sales reps has been dropping for quite some time now, and face-to-face engagements have declined significantly over the years. According to a survey from DRG’s 2019 annual ePharma Physician Report, 54 percent of physician respondents said they saw pharma reps in person in 2019, down from 67 percent in 2018.

DRG ePharma Physician Report 2019 – % of physician respondents on pharma rep interactions11 1

Source: ePharmaPhysician® US 2019

Today, given the COVID-19 pandemic, healthcare providers, including hospitals and clinics, are increasingly refusing in-person visits from pharma sales reps, and pharma companies such as Biogen and Global Blood Therapeutics have themselves suspended face-to-face meetings. In turn, virtual interactions between reps and healthcare providers are increasing, with BMS, GSK, Pfizer, and Sanofi – to name a few – scaling up the use of remote technology to ensure continued engagement with healthcare professionals. We expect this progress to continue even after the pandemic’s threat has abated.

However, not all pharma firms are well equipped for this shift; there’s a wide degree of variance when it comes to the maturity of their virtual healthcare provider engagement capabilities. Not surprisingly, the many digital solutions that exist in the current market can help them. Several software vendors and IT services providers have developed innovative CRM solutions, such as around personalized engagement, interactive detailing, and live video through intuitive mobile apps and web portals, in order to effectively engage healthcare providers virtually.

In response to the crisis, many vendors have recently begun to enhance product functionality. For instance, Veeva recently introduced new capabilities for remote drug sampling in Veeva CRM Engage Meeting. The company also announced several alliances for digital field engagement.

Yet, going forward, getting virtual sales right could be a major deciding factor for whether or not pharma firms are able to convert extensive R&D efforts and patent wins into commercially successful therapies.

Here are our suggestions on how pharma firms can successfully pivot to a virtual sales :

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  • Realign budgets Drive C-suite endorsement of initiatives whose goal is improving virtual engagement with healthcare practitioners. Money saved on aspects such as travel and organizing marketing conferences/gatherings should be diverted to investments in IT and content creation.
  • Engage technology partners to have the right solutions in place Assess the landscape of solutions from Independent Software Vendors (ISVs) and IT services providers. Look for verticalized CRM solutions meant particularly for healthcare provider engagement. Prioritize quickly implementable and scalable solutions that give the assurance of little downtime and offer omni-channel (email, web, mobile, etc.) and personalized engagement.
  • Create compelling content Rethink marketing strategies. Content delivered virtually needs to be all the more engaging, detailed, and easy to consume. Such content could include live videos, webinars, intuitive brochures, and web/mobile portals. Generating personalized content can improve conversion rates. Finally, content needs to be such that healthcare providers can consume it in their own time and follow up on as needed, minimizing the need for live interactions.
  • Train representatives to effectively engage and deliver information in virtual settings Facilitate a cultural shift in sales operations from being in-person to virtual through dedicated training programs. Representatives need to utilize the time saved on travel to draft strategies for more engaging interactions. They also need to be trained on using specific technology tools for provider engagement.

While healthcare workers are bound to be overburdened and under tremendous stress in these times, this is also a tough time for pharma sales representatives. Assertive sales behavior might come across as being insensitive, but at the same time, healthcare practitioners need to be kept aware of new therapies for ailments apart from COVID-19. Shifting to a virtual model represents a huge change. Engaging with empathy and showing flexibility in working around physician schedules will be paramount in the near term, as pharma enterprises come to grips with what could potentially be a new, or next, normal.

 

Is the Medical Device Industry Prepared for the New EU Medical Device and In Vitro Diagnostic Regulations? | Blog

The EU had planned to implement a new set of regulations – the European Union Medical Device Regulations (EU MDR) in May 2021 and In Vitro Diagnostic Regulations (IVDR) in May 2022 – to establish stringent device controls, improve transparency and product traceability, and strengthen clinical evaluation and post-market surveillance. But a series of overwhelming events has forced EU regulators to shift the MDR implementation from May 2020 to May 2021.

The global COVID-19 pandemic is the primary cause of this deferment. However, constant pushbacks from trade associations have also played a role, as has strong evidence of the industry’s under-preparedness to comply. For example:

  • Under the existing Medical Device Directive (MDD) there are 58 Notified Bodies (NBs) –organizations that have been designated by a member state to assess the conformity of certain products before being placed on the EU market – that cater to the industry. With the new regulations, there will be only 11 NBs with an EU MDR designation and three with an IVDR designation to handle a workload of 500,000 medical device technologies available in the European market
  • Reclassification and up-classification of both existing and new products under the new regulations put considerable financial and administrative strain on small and mid-sized firms
  • Increased complexity in documenting the additional requirements of clinical evaluation and post-marketing surveillance, as the industry moves toward a lifecycle approach, to necessitate proactive monitoring of device performance.

To overcome these challenges, stakeholders across the medical device industry, including medical device manufacturers, contract research organizations (CROs), and service providers, should focus on specific areas.

  • Medical device manufacturers should outline a compliance strategy to adapt to the regulatory reforms. As the regulations also increase the cost and time required to enter the European market, they should also build alternative business plans, with a focus on budgeting resources and redefining product portfolio and market entry strategies to remain competitive. To achieve compliance and build a collaborative and transparent framework, they should also update their legacy systems and embrace cloud-based solutions
  • CROs and service providers can provide strategic support to medical device manufacturers in building a regulatory roadmap and enhancing technological capabilities. Also, the new regulations’ stringent data requirements will increase the focus on data collection and management tools, and data governance and security. Service providers should align their clinical and post-market offerings with EU MDR and IVDR offerings to gain traction. For instance, HCL’s regulatory Center of Excellence (CoE) now provides end-to-end MDR and IVDR compliance services to manufacturers.

The medical device industry is exploring multiple ways to continue to stay relevant in the European market. While some organizations are leveraging the EU MDR and IVDR transitional provisions (MDD and IVDR certificates issued before May 2017, which will remain valid until they expire or May 2024, whichever comes earlier) to extend their market presence, others are building their regulatory capabilities and deploying both internal and external workforces to do so. Cook Medical, for instance, is hiring 20 full-time EU MDR-specific roles and working with over 70 contract-based individuals. Likewise, service providers such as Capgemini and TCS are seeking to hire regulatory specialists.

The launch date’s extension by a year might just provide the much-needed relief and time all stakeholders need to build their capabilities to comply with the new regulations.

For more insights on the impact of EU MDR and IVDR on the medical device industry, please see our recently published viewpoint Regulatory Overhaul of the EU Medical Device Market or contact [email protected], [email protected], or [email protected].

 

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