EY - A new prescription for market success

5 insights for executives

A new prescription for market success

Using commercial agility to gain market share

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Today’s complex health ecosystem is driven by diverse stakeholders and customers, each with unique challenges and needs.

Time-tested commercial strategies that proved successful in the past no longer fit the jagged edges of today’s health ecosystem.

Gone are the days when prescribers would decide on a course of treatment based solely on their own judgment without considering the preferences of others.

In years past, companies built their business model on “blockbuster” drugs — those that, broadly defined, brought in more than $1 billion a year in revenue. Those drugs became dominant brands, the concept of brands in turn dominated the industry, and highly profitable silos were built.

In recent years, the flow of blockbuster drugs has slowed, lucrative patents have expired, and the focus on cost containment in health care has intensified. In response, leading companies have been shifting their business model to become even more relevant and avoid commoditization.

The old focus on delivering drugs to the health care system has given way to a focus on delivery of value-added services in support of positive health outcomes, defined as health benefits, both clinical and economic, per dollar spent.

In this shift — from what we call Pharma 1.0 through the building of diversified product lines (Pharma 2.0) to the focus on outcomes (Pharma 3.0) — pharmaceutical companies have found that there is no longer a single point of influence. In Pharma 3.0, patients are more informed, new players are entering the arena, and old roles are changing.

The marketplace has become highly interdependent, and pharmaceutical companies, which find themselves in an unfamiliar and changing landscape, must adapt. They must become commercially agile.

Our series, 5: insights for executives, explores the questions:


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