I just came back from this year’s Innovations & Investments in Healthcare Summit in Berlin. Apart from being a fabulously organized event with an eclectic and exclusive crowd, many forward thinking physicians and industry representatives were present at the two-day program.
A particularly interesting discussion with a manager from MSD was centered on the challenges Pharma will face in the near future. The topic has been brought up many times in different healthcare settings, but it still reminds me of how difficult these times are for Pharma and makes me think about the potential of business models to reshape the industry.
The business model of pharmaceutical companies is based on selling drugs. It’s that simple. Yet, selling drugs is apparently no longer sufficient. With budget cuts around the globe, hectic internal re-organizations and cutting-down on sales force, the Pharma industry is forced to look for ways to get out of this dilemma.
Times have changed. Many years have past since American Express has transformed into a company that not only deals with credit cards, Airports are generating more money through shops on the ground than for charging fees to airlines and Apple uses iTunes to leverage its hardware. Things have turned around favorably for businesses in countless industries, yet nothing seems to be changing in Pharma.
As to the question in the headline of this post: I don’t have an answer, but I’m happy to discuss it further in the comment section. What do you think is the future business model of a pharmaceutical company? Which firm is going to be the “AmEx of Pharma”?