20200212-德勤-2020_global_life_sciences_outlook_70页_3mb

2020 Global Life Sciences Outlook Summary

Core Content

The 2020 Global Life Sciences Outlook by Deloitte highlights the transformative potential of the life sciences sector, emphasizing the role of technology, data, and human-centric approaches in creating new value. The report discusses the convergence of technology and behavioral science, the importance of measuring human experiences, and the evolving landscape of mergers and acquisitions (M&A), clinical trials, and work culture in the industry.

Main Points

1. Creating New Value

• The life sciences sector is at an inflection point, driven by innovations such as cell and gene therapies, AI, and machine learning.
• These technologies are enabling more efficient and innovative therapy discovery and development.
• Data-driven approaches are creating value across the entire health care ecosystem, from manufacturing to supply chain and patient care.
• The future of work is moving toward meaningful work and value-based models, with a growing emphasis on purpose and human-machine collaboration.

2. Measuring the Human Experience

• Biopharma and medtech organizations should adopt a holistic strategy to measure the human experience of all stakeholders—patients, employees, and ecosystem partners.
• This includes mapping touchpoints, improving the ease of interactions, and addressing the needs of diverse populations.
• Collaboration across departments (marketing, HR, operations, IT) is essential to create a common set of experience measures.
• Patient-centric models are becoming central to operational strategies and personalized health care.

3. The Human Value of Technology Acquisition

• Flatiron Health exemplifies the value of human involvement in data curation, especially in unstructured data from medical records.
• By combining human expertise with AI and machine learning, Flatiron Health improved cancer research and was acquired by Roche for $1.9 billion.
• The report emphasizes the need for organizations to integrate human strengths with technology to drive exponential thinking and value creation.

4. Inclusive Clinical Trials

• Clinical trials have historically lacked representation from key demographic groups, leading to generalizability issues.
• HeLa cells, derived from Henrietta Lacks, have been pivotal in medical research, yet their use raises ethical concerns.
• There is a growing call for more inclusive and diverse trial participation, especially among racial and ethnic minorities, women, and the elderly.
• Initiatives such as the ROAR toolkit and the NIH’s “All of Us” program are working to improve trial participation among underrepresented groups.
• Virtual clinical trials are emerging as a solution to overcome structural and clinical barriers, increasing access and diversity.

5. The Future of Management and Work Culture

• Organizations are moving toward self-management and agile practices, often referred to as "teal" organizations.
• These organizations prioritize purpose, wholeness, and autonomy, fostering creativity and innovation.
• A culture built around capabilities, not just skills, is becoming more important as work environments evolve.
• Companies like Novartis are embracing flexible and agile cultures, with a focus on employee development and reverse mentoring from younger generations.

6. Market Trends and M&A Activity

• In 2019, life sciences deal values increased significantly, with $181.7 billion in the first three quarters compared to $135 billion in 2018.
• The number of M&A deals decreased, but the value of each deal rose, indicating a shift toward strategic acquisitions.
• Bristol-Myers Squibb acquired Celgene for $74 billion, and Roche acquired Spark Therapeutics for $4.4 billion.
• China and South Korea are emerging as key players in global life sciences M&A, with significant deal activity in the first half of 2019.

7. Biotech IPOs and Direct Listings

• In 2019, several biotech companies entered the public market with valuations exceeding $2 billion, marking a strong year for IPOs.
• The direct listing model is gaining traction as an alternative to traditional IPOs, allowing companies to list existing shares without dilution.
• This model is expected to be considered by more technology companies in 2020 as a viable path to public listing.

8. Software and Cloud Investments

• Software licensing and cloud investments are becoming critical for life sciences companies.
• The market for compliance, risk management, and product life cycle management (PLM) software is expected to grow significantly.
• Cloud migration is driven by security and data protection, with a majority of life sciences companies adopting data modernization strategies.
• In 2020, more ERP buyers are expected to move to the cloud, leveraging flexibility and scalability.

9. Return on Capital and Value Creation

• Return on capital (ROC) has declined for many life sciences sectors, including drug intermediaries, health plans, and manufacturers.
• The report suggests that new metrics such as ROC will be important for assessing value creation in 2020.
• A focus on capital efficiency and profitability will be essential for organizations to remain competitive.

Key Information

• AI and machine learning are expected to revolutionize therapy discovery and development.
• Patient-centric models are shaping operational strategies and driving personalized health care.
• Inclusive clinical trials are crucial for improving the generalizability of research and addressing health disparities.
• Technology acquisitions are becoming more strategic, with a focus on combining human expertise with automation.
• Direct listings are emerging as an alternative to IPOs, especially for tech companies.
• Cloud technology is increasingly seen as a competitive advantage and is being adopted by life sciences companies.
• ROC is a key metric for evaluating the efficiency of capital allocation and profitability in the sector.

Conclusion

The life sciences industry is evolving rapidly, driven by technological innovation, a focus on human experience, and a push for inclusivity and efficiency. Organizations must adapt by integrating human strengths with technology, rethinking traditional metrics, and embracing new work models. As the sector moves toward a more data-driven, patient-centric, and agile future, the ability to create value through meaningful work and inclusive practices will be central to long-term success.