We were wondering if big pharmaceutical companies are adverse to the disruptive element of innovation. So, we asked our Zintro experts what they thought.
Pradeep Oza, an expert in pharmaceutical marketing, thinks that big pharma companies are not adverse to innovation; the issues are timelines and the financial risks a company has to take. “Developed markets are fighting escalating health bills due to an aging population, and one can see cuts in spending for healthcare cost. The generic industry has evolved as a major force to reckon with, and big pharma has to be focused on plans and strategies and find a balance from an innovation perspective. This type of strategy calls for a great degree of fine tuning of business models,” Oza says.
Oza thinks that with these issues, and the high costs involved, many big pharma companies hold back. “Existing drugs may see a lot of innovation in terms of drug delivery and in where the clinical failure rates are high but success rates are pretty high too. Big pharmas may embrace innovation in certain areas, but may hold back due to times lines and commercial viability,” he says.
Samson Fung, an expert in pharmaceutical clinical research and development, says that there are two sides to consider. “On one side, the pharma companies are very innovative with scientific advances and putting the latest technologies into usable products. This concerns marketing and finding new models on how to appraise products and get better messages to sell them,” Fung says. “On the other side, pharmas are extremely risk and innovation adverse around new models of risk sharing or tools to demonstrate benefits towards society. Being prepared for risk taking in big pharma is institutionalized and confined to the more scientific parts and marketing.”
Fund also points out another reason for big pharmas being risk adverse, which is keeping high profit margins. “Big pharma has a lot to loose, and as long as society is willing and able to pay the enormously high prices they want, they will stay the course,” he says. “In contrast, the biotech industry is always struggling for solid financing, which makes it willing to take more risk.”
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