Tag: Pharma companies

Why Pharma Companies View their Indian Shared Services Centers as Growth Partners |Blog

India is clearly becoming the “it” destination for pharmaceutical companies’ shared services centers (SSC) – or Global In-House Center (GIC) – organizations. Why do we say this? Because global pharmas with headquarters in the U.S. and Europe employ more than 11,000 FTEs employees in their India-based shared services centers to deliver not only table stakes transactional finance and HR services but also highly complex processes across all stages of drug development, including drug R&D and clinical trials.

What’s India’s appeal? There are four factors.

Established/Mature Location for Global Pharma Services Delivery

India is a time-tested, proven GIC destination for a wide range of industries. Many of the world’s leading pharmaceutical companies started delivering their global services support operations from India back in early 1990s. Now, pharma majors like AstraZeneca, Eli Lilly, and Novartis are delivering complex, judgment-intensive services such as product R&D, biostatistics, and clinical trials site management from their India GICs. Hyderabad, Chennai, and Bangalore are the preferred locations, housing more than 80 percent of the pharmaceutical GIC talent.

Skilled Talent Pool

Talent availability, at scale, is one of India’s strongest value propositions. In recent years, many pharma companies have been able to successfully scale their delivery teams supporting diverse functions such as R&D, commercials, IT, and finance. For example, a leading pharma GIC houses 2,000+ resources providing IT services for various pharma functions. And multiple other pharma SSCs have scaled teams (400+ resources) that support R&D services, and dedicated resource groups comprised of doctors, PhDs, and biostatisticians, for complex drug R&D processes like development of computational solutions for analyzing clinical trials.

Opportunities for Cross-functional Collaboration

India’s availability of diverse talent profiles at scale allows India-based pharma SSCs to support multiple functions. And because many of them house IT resources with R&D and commercial business teams, they have multiple opportunities to collaborate on and insource IT work for drug R&D (e.g., to build IT platforms for drug development and IT services for lab support), and commercial operations (e.g., IT services for finance.) The value of this collaboration? Tighter integration of functions, better understanding of business requirements, and faster execution.

Mature Market for Digital Services Delivery

Leading India-based pharma GICs are working on digital initiatives including analytics and automation, and some are serving as global automation CoEs for their parent enterprises. Many are developing analytical tools for marketing & sales operations, competitive intelligence, and incentive planning. They are also investing heavily in automating less complex and high-volume transactional processes such as expense management, purchase order creation, offer letter generation, résumé screening, and management reporting, and deploying RPA bots to read files, extract data, and report adverse events. As part of the broader digital agenda, some centers have also started exploring the uses of artificial intelligence/machine learning to recruit patients and select sites for clinical trials, and for channel sequencing and optimization in their enterprise’s sales & marketing function.

Going forward, pharma companies not only expect their India SSCs to grow in scale and expand the scope of their process delivery, but also play a significant role in their digital transformation journeys by leading initiatives across all stages of the product R&D lifecycle. To satisfy these expectations, the GICs need to build deep domain capabilities and acquire or train talent to deliver increasingly complex, higher up the value chain services and next-generation digital initiatives.

To learn more about why pharma companies consider India their preferred service delivery destination, please read our recently published report, “Healthcare and Life Sciences – GICs in India Fast-tracking Enterprises’ Digital Agenda,” or connect directly with the report authors Anish Agarwal, Bharath M, and Rajeshwaran Pagalam.

Pharma Service Providers’ Role in Tempering Pricing Wars | Sherpas in Blue Shirts

Shortly after the U.S. Food & Drug Administration (FDA) approved Novartis’ CAR T-cell drug, Kymriah – which is used for pediatric B-cell Acute Lymphoblastic Leukemia – last month, Novartis announced its price…a whopping $475,000 per patient. This is certainly not the first market instance of highly expensive drugs (see below.)

But it might just be the tipping point for stakeholders – including regulatory bodies, payers, physicians, advocacy groups, and patients – to start having constructive discussions with drug manufacturers on how to make drugs that treat extremely rare diseases more accessible to the very small share of the population that needs them.

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It is certainly time for pharma companies to overhaul their operations in order to mitigate price anger and get such drugs into the hands of those whose lives depend on them.

One way they can do so is by employing pay-for-performance, or outcome-based, contracts, wherein the manufacturer charges for the drug once it proves effective, say one or two months into treatment. Note that this pricing model hasn’t yet really taken off, especially in the United States, where the fragmented multi-payer environment acts as an added roadblock. Indication-based pricing, wherein there are different prices for different conditions, is another model that biopharma companies can use, but the U.S. market does not have mechanisms in place for it, at least as of now.

Other ways of ensuring patients are able to benefit from such critical drugs are through mixes of personalized offline and online marketing campaigns directed specifically to the relevant patient and physician pool, and improved and comprehensive patient support programs to help in solving “last mile connectivity” issues.

But at the end of the day, stakeholder backlash might – and should – force pharma companies to drive down their own costs to make these expensive, personalized medicines more affordable. And this is where outsourcing service providers can help.

The third-party service providers that are already servicing the pharma industry need to prepare or bolster solutions and capabilities around areas including patient and market access, data analytics, omnichannel marketing, IoT, automation, portals, applications, customer support, pricing analytics, infrastructure modernization, and cloud orchestration. Service providers that are struggling to enter the life sciences space should view this as a window of opportunity to get a foot in the door of these companies. Doing so will mean additional business for both these types of vendors; it could also mean reduced pricing pressure for the patients who need such vital treatments.
The future of personalized medicine depends a lot on success of such drugs, and biopharma companies can no longer afford to sit back and operate like they always have. For a detailed discussion and analysis around these solutions, and to learn about other trends in the life sciences market, look out for our soon-to-be-published State of the Market Report.

Technology is the Key to Innovation in Pharmacovigilance | Sherpas in Blue Shirts

The critical nature of Pharmacovigilance (PV) is obvious. For patients, it can mean the difference between better health or death from an Adverse Drug Reaction (ADR). For pharma companies, it can mean the difference between a profitable, life-saving drug, or multi-billion dollar fines and loss of reputation and revenue.

Although global PV spend has increased from 0.3 percent of total sales in 2003 to 1 percent (the equivalent of ~US$15 billion) in 2016, some of the pharma industry’s most expensive drug recalls/fines/lawsuits occurred during this timeframe.

Everest Group does not think that a further increase in PV spend is the best way for pharma companies to curb safety breaches. Rather, we believe the answer lies in creating a more effective PV process through use of technology, including analytics, automation, cloud, and mobility.

There are some well-publicized technology use cases in the pharma industry. For example, led by a consortium of world-leading experts from industry, regulatory agencies, and academia, the Web-RADR project will deliver an EU-wide mobile phone app that enables users to report adverse drug reactions directly to their National Competent Authority (NCA). And the U.S. Food and Drug Administration (FDA) has launched Sentinel, a distributed data system through which it can rapidly and securely access information from large amounts of electronic healthcare data from a diverse group of data partners.

And there are myriad ways in which technology can support pharma companies’ PV initiatives. For example:

 

 

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Digitized medicines: Smart pills with ingestible sensors can be used to track and collect patients’ health data, which can be used to run analytics for Adverse Event (AE) detection.

Mobile apps: These apps can enable pharma companies to collect ADR data much more quickly.

Cloud-based solutions: Cloud-based databases can enable pharma companies to collect data from multiple stakeholders to build an integrated ADR repository – even at a global level.

Artificial intelligence (AI): AI can help pharma companies to move beyond basic automation by identifying patterns in unstructured data.

Automation: RPA solutions can help pharma companies process structured data much more rapidly than via manual efforts.

Big data analytics: Analytics can help pharma companies use the vast amount of digital data available on the Internet (e.g., on Facebook and Twitter, and in patient forums such as Doctissimo) to supplement traditional data sources such as primary calls, EHR data, and claims data for AE detection.

Proactive PV: Robust IT solutions and advanced systems can help pharma companies monitor drug safety during the research and trials process and post-launch.

 

How Pharma companies capitalize on technology?

To fully capitalize on the benefits technology can deliver to the PV process, pharma companies must begin with establishing a clear and robust strategy for what they want to achieve and how they should progress along the technological curve. For instance, if their end-goal is to implement an AI-based solution, they should first invest in basic automation, analytics, and cloud. As pharma companies tend to lag behind those in other industries in terms of adopting new and innovative methods, they may find it valuable to partner with a third-party advisor to assist in the development of their strategy.

Next, they should proactively identify opportunities and partner with specialized technology vendors to fill technology gaps. For example, while many pharma companies are investing in the development of mobile-based adverse event reporting apps, they will not be able to realize their full potential until all the apps are connected with a common platform that precludes patients from having to download apps for each drug.

Finally, they should strongly consider partnering with outsourcing service providers that have a proven history of supporting the delivery, technology, and regulatory reporting requirements of the PV process. Call center, case entry, literature review and insights mining, aggregate reporting, and PV quality assurance are some of the areas in which outsourcing service providers can of great help.

Pharma companies have long been slow to adopt technology in PV. However, the time has come for technology to play a greater role in delivering solutions, with technology vendors and outsourcing service providers serving as force multipliers.

For detailed insights on new technological innovations in the PV market, please refer to Everest Group’s viewpoint: Innovation in Pharmacovigilance (PV): How to Spend Smarter Not Higher?

Pharmaceutical Companies Can Help Support Trump’s Vision of Make America Great Again | Sherpas in Blue Shirts

When U.S. President Donald Trump met with the CEOs of a host of major pharmaceutical companies in late January 2017, one of his primary declarations was that drug makers should bring manufacturing and production, much of which is done in countries like India and China, back to the United States.

While moving FDA-certified production factories and establishing new supply chains back onshore is an extremely difficult, years-long ordeal, failing to take some type of proactive step to appease the Trump administration could open the door to potentially unfavorable actions for the major pharmaceutical companies. Think patent reforms, price lock-downs, consumer advertisement bans, and import/export tax mandates, all of which could wipe out the lucrative margins from U.S. consumers.

But there’s one easy step pharma companies can take to mollify the administration’s overarching agenda: start moving services jobs – such as IT, finance, and HR – back to U.S. turf.

Aprrox. 110k to 140k pharma industry services jobs have been offshored, with the majority residing in India

Trump and the pharma industry services jobs

If you look at the dollars, cents, and sense of doing so, it really is win-win. Consider:

  • Services jobs are the least likely to disrupt core business operations if brought back onshore
  • They’re comparatively easy to move, as they’re essentially labor-based and mostly centralized in offshore service centers
  • Doing so would not only provide gainful employment to more U.S. workers, but also signal a commitment to invest in the U.S. workforce and worker productivity
  • Pharma companies could avoid a negative impact to their bottom lines (i.e., a 50-70 percent labor arbitrage) if they effectively leverage digital technologies and capabilities to transform their delivery models as they repatriate the services.

Let’s take a deeper dive look at this last bullet point. True that India’s and other low-cost regions’ skilled workforce and cheaper labor made them attractive locations for offshoring pharmaceutical services jobs. This labor cost advantage has shielded pharma companies from having to take the painful and arduous path towards step-change improvements in workforce productivity, which requires significant investments and service redesigns. After all, why automate if you can get two or three offshore workers for the price of one U.S. worker?

But the world has changed. Digital service models are transforming how services are delivered and consumed. For example, when was the last time you filled out a deposit slip at a bank? Mobile deposits rule the day now. These transformations are happening across the services functions, and are opening the door to operational savings and productivity improvements.

Higher US labor costs can be mitigated by leveraging digital capabilities to transform the service functions being migrated back

Trump and the pharma industry services jobs

By moving and transforming their services, pharma companies wouldn’t bring back all of the jobs they initially offshored, but would create higher paying, higher skilled, and highly productive U.S. services jobs. And, this could be done relatively quickly and on a cost neutral basis with no impact to their bottom- or top-lines, while simultaneously leveraging digital technologies to transform their service delivery models.

It’s true that uncertainty abounds around what levers the Trump administration will pull to entice or force the pharmaceutical industry to align to its core tenant of creating U.S. jobs and “Making America Great Again.” But wait-and-see is a dicey game to play when it comes to the pharmaceutical industry’s most lucrative market.

Everest Group’s advice is to get ahead of the game – starting today. Take a fresh look at your company’s global talent management strategy and shared services construct to identify your degrees of freedom. Then start engaging your technology and services organizations to assess how you can bring some or all of these services jobs back to the U.S., and at the same time offset the higher labor costs with digital technologies and delivery models. It might just save your CEO from seeing an early morning Tweet from President Trump stating, “Horrible company!”

Learn more about the importance of bringing pharma jobs to the United States in Stephen Chen’s executive viewpoint, Will Big Pharma Heed the Call to Bring Jobs Back Home?

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