Though there are several speculations about the stagnant growth of the pharmaceutical industry, recent technological innovations are expected to facilitate growth in the years to come.
The huge shift of the population to urban areas and increased accessibility of people to healthcare services have opened doors to a wider target market for the pharmaceutical industry players. These emerging markets are becoming increasingly important for pharma companies. However, to be successful in the market, it becomes essential for companies in the pharmaceutical industry to shift from a marketing and sales-focused model to an access-driven commercial model. Additionally, with the governments of several countries making healthcare a priority in their policies, the future looks bright for pharma companies. But on the flip side, the market conditions and several other factors might not entirely be in favor of pharma companies. There are several challenges lying ahead for pharmaceutical industry players, which they need to combat before heading on the road to success:
TOP PHARMACEUTICAL INDUSTRY CHALLENGES
Healthcare policy reforms
The US is the top player in the global pharma market. However, the changing healthcare reforms are affecting the pharmaceutical industry players in a big way. The Patient Protection and Affordable Care Act (PPACA), which is also known as Obamacare, is expected to undergo some significant reforms under the new government. Though healthcare policy reforms are on the top of the priority list for the new presidential administration, we are yet to see how these policies are going to affect the pharma industry in the longer run.
Impact of new technologies on pharma
Players in the pharmaceutical industry are still unsure about how the new digital technologies are going to impact drug development and commercialization. Several industrial experts feel that emerging technologies such as AI and 3D printing will cause radical changes in the business models, operations, workforce, and cybersecurity. The adoption of these technologies would also have additional benefits such as the ability to establish a digital supply chain in reducing manufacturing costs.
Increased focus on ‘patient-centric’ healthcare
One of the most popular trends in the healthcare industry in recent times is the shift towards a patient-centric care model. Bringing the spotlight to the quality of care given to patients and making them active participants in the treatment process has put immense pressure on the pharmaceutical industry players. Furthermore, increasing regulatory measures are forcing pharma companies to deliver the best quality of services to prevent any regulatory actions.
Slower growth rate in emerging markets
Companies in the pharmaceutical industry have been reaping significant benefits from the emerging markets, but the recent economic slowdown in these markets has had a negative impact on the profit potential. The reduction in the GDP of these low-income countries with high pharmaceutical growth prospects has triggered a corresponding reduction in the volume growth. Unless these emerging markets pick up on their economic growth, the development of pharma companies in these markets will prove to be difficult.
The flow of venture capital is an essential factor for the smooth functioning of companies in the pharmaceutical industry. But the bad news is that the investments in venture capital-backed companies in the US has shown a constant decline in the recent past with fluctuations in deals and dollar. A significant challenge lying here for players in the pharmaceutical industry is to win back the confidence of investors in the sector.