The future of biopharma
OVER the next 20 years, we expect biopharma business models to be reshaped by five forces—from inside and outside of the industry—that will likely require current players to evaluate shifting markets and determine how they will compete. Biopharma companies will continue to develop new ways to treat and cure a wide range of diseases. However, actionable health insights, driven by radically interoperable data and artificial intelligence (AI), can help clinicians and consumers identify illness much earlier than we do today. Vaccines and other early interventions could prevent a greater number of diseases from developing in the first place. Other illnesses might be prevented through nonpharmacological treatments. Shifts in how diseases are identified, prevented, treated, or cured may lead to fundamentally different business models for traditional biopharma companies and new entrants.
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Researchers from the Deloitte Center for Health Solutions interviewed 14 thought leaders (futurists, venture capitalists, digital health leaders, and academics) to find out how they expected the identification, prevention, and treatment of disease to evolve between now and 2040. Through these interviews, five forces emerged that could alter the course of the biopharmaceutical sector. These forces represent both opportunities and threats to incumbents. They include prevention and early detection, custom treatments and personalized medicine, curative therapies, digital therapeutics, and precision intervention. Interviewees noted that disruption is already taking place in the industry, and they tried to project where those threats might lead over the next 20 years.
The forces of change highlighted in this paper are likely to reshape, if not shrink, the market for biopharma products. Biopharma companies should consider the potential for disruption by these forces as they redefine the types of products and solutions they will offer, where they will compete, and the new capabilities they will require. Company leaders should develop strategies to counter potential threats and take advantage of the short- and long-term opportunities that emerge in this changing environment. Organizations that ignore these forces and maintain the status quo could wind up shrinking in parallel to the demand for drug interventions to manage symptomatic diseases.
The future of health that we envision in 2040 will be a world apart from what we have now. Based on emerging technology, we can be reasonably certain that digital transformation—enabled by radically interoperable data, AI, and open, secure platforms—will drive much of this change. Unlike today, we believe care will be organized around the consumer, rather than around the institutions that drive our existing health care system.
By 2040 (and perhaps beginning much before), streams of health data—together with data from a variety of other relevant sources—will likely merge to create a multifaceted and highly personalized picture of every consumer’s well-being. Many digital health companies are already beginning to incorporate always-on biosensors and software into devices that can generate, gather, and share data. Advanced cognitive technologies could be developed to analyze a significantly large set of parameters and create personalized insights into a consumer’s health. The availability of data and personalized AI can enable precision well-being and real-time microinterventions that allow us to get ahead of sickness and far ahead of catastrophic disease. By 2040, health is likely to revolve around preventing some diseases from happening, and curing others. Many fewer people would have long-term conditions with continued need for medication to treat symptoms.1
In this future of health, the era of blockbuster drugs that treat large populations will likely wane. Instead, the biopharma sector is on the fringe of an era where hypertailored therapies are developed to cure or prevent disease rather than treat symptoms. Twenty years from now, rather than picking up a prescription at the pharmacy, personalized therapies based on a diverse set of a patient’s characteristics including their genomics, metabolome, microbiome, and other clinical information might be manufactured or compounded just in time through additive manufacturing.
How might exponential advancements in science and technology impact biopharma companies? What are some examples of disruption already happening in the market, and how quickly is change likely to occur? To find out, researchers from the Deloitte Center for Health Solutions conducted interviews with 14 forward-thinking industry experts (for more details see the sidebar, “Methodology”).
The Deloitte Center for Health Solutions conducted telephone interviews with 14 industry experts including researchers, academics, futurists, investors, and former biopharmaceutical company executives from September to December of 2019. In addition, we conducted secondary research to identify startups and established companies that are already beginning to disrupt the biopharma sector.
A note to readers: This research was conducted before the novel coronavirus (COVID-19) became a focus for drug and vaccine development. At the time of publication, academic and biopharma researchers were increasing data transparency, leveraging accelerated regulatory pathways, and setting up adaptive trials to develop and test drugs and vaccines to address the pandemic. It is too early to opine on the timing and impact of those activities and how the forces we describe in this paper might accelerate or change how biopharma responds to pandemics in the future. We look forward to reporting about innovative approaches and lessons learned from this situation.
The five forces
Our interviews confirmed that five forces are beginning to impact biopharma companies but are likely to disrupt the sector more dramatically in the years ahead. Most of our interviewees agreed with our vision for the future of health that these forces—driven by players inside and outside of the biopharma sector—could have a seismic impact on biopharmaceutical companies and the patients they serve. The five forces, listed in order of potential disruption to the traditional scope of the biopharma industry, are:
- Prevention and early detection: Vaccines and improvements in wellness could help prevent disease, making treatment for some diseases no longer necessary. Advances in early detection will likely enable interventions that halt diseases in the earliest stages—before they progress to more serious conditions.
- Customized treatments: Personalization in medicine—driven by data-powered insights—could effectively match patients with customized drug cocktails, or design therapies that would work for just a few people, or even a particular person (i.e., “n of 1”).
- Curative therapies: As with prevention, treatments that cure disease could reduce or eliminate the demand for some prescription medicines. Developing, marketing, and pricing these curative treatments could require the biopharma sector to adopt new capabilities.
- Digital therapeutics: Increasingly effective and scalable nonpharmaceutical (digital) interventions—including those focused on behavior modification—might also reduce or eliminate demand for medications.
- Precision intervention: Increasingly sophisticated medical technology—such as precise medical intervention enabled by robotics, nanotechnology, or tissue engineering—could reduce the need for pharmaceutical intervention.
As we move toward the future of health, biopharma incumbents should consider new strategic investments to position themselves for success. The changes that we see on the horizon will likely require biopharma companies to consider new types of markets, alternative business models, or a complete change in how they define what work they do.