As you contemplate offering new healthcare products and services, I suggest that you engage your laser focus on significantly reducing the costs of medical products and procedures - while at least maintaining the quality of care. Given the current intense focus on those costs, their reduction offers an excellent path to commercial success. View current costs as problems to be solved, then innovate to reduce them.
Attacking the costs of medical products in particular is a worthwhile activity, but it's not enough. More leverage (and more commercial success) will result from lowering the societal costs of interventional procedures, diagnostic methods, and treatment protocols.
Then there's the matter of drug costs, a current issue of widespread interest and white-hot rhetoric - an issue closely linked to reported pharma R&D expenditures. Those reported levels of R&D investment are controversial and obviously related to the dismal R&D productivity of drug R&D.
Depending upon your point of view and your role in the US healthcare system, you are either convinced that (1) current drug pricing is justifiable and contributes little to overall healthcare costs, that (2) pharma R&D is terribly inefficient and must be improved and modernized, or that (3) both statements are true.
I find that the first (industry) view is well summarized by Luca Dezzani, Global Medical Director at Novartis, in his recent post entitled "
Cost of Medicines in Context." The second (more prescriptive) view is laid out by CPhl North America in its recent whitepaper entitled "
Pharma Must Lower R&D Costs - Here's How to Do It." They recommend focus on three broad initiatives:
- Decreasing the risk and failure rates within the drug development process
- New drug development models
- Key changes to regulatory constructs
Regardless of where you stand on this critical issue, it's difficult to argue against an improvement in the poor productivity of drug R&D. Something's got to give!
