There has been a tremendous amount of growth in the pharmaceutical industry in recent years and the outlook continues to be positive for 2020. In fact, the industry is expected to exceed a $1 trillion by the following year. This is partly due to thousands of compounds that are currently in the latter stages of clinical development, coupled with hundreds of new products with approvals anticipated in 2020 and beyond. This happens to be a level of pharmaceutical production that is not customary and has not occurred for about a decade. Let’s take a close look at 10 trends that will transform the pharmaceutical industry in 2020.
Trends In Pharmaceutical Industry Shaping The Industry In 2020
1. Use of Artificial Intelligence
Artificial intelligence (AI) is a term that is becoming increasingly popular across all industries. It’s essentially the use of computer systems to perform tasks that would otherwise require human intelligence. This includes tasks like decision-making, speech recognition and visual perception. It also enables the translation of information between different languages. The use of AI in the pharmaceutical industry has different roles that are expected to expand, such as accelerating the process of drug discovery and development. Some of the areas that will benefit from AI include clinical trials, fraud detection and the overall improvement of medications.
2. Greater Acceptance of Medical Marijuana
Without a doubt, there are some doctors that were not eager to jump on the medical marijuana bandwagon, even after it became more widely accepted. This is starting to change and it’s a trend that will continue in 2020. Simply put, the perception of cannabidiol (CBD) when used as medication is changing. Many of the healthcare professionals that found it difficult to accept in the past cannot deny the benefits that have become evident when using medical marijuana for pain reduction, mood regulation, digestive functions, and vascular health, among other conditions. Subsequently, the pharmaceutical companies recognize the tremendous opportunities that exist.
3. Precision Medicine
Personalized medicine is when medication is produced based on a specific patient diagnosis. The purpose is to ensure the drug is tailored for optimal effectiveness and patient outcomes. The use of precision medication has demonstrated a higher level of effectiveness than other options. The problem that exists for manufacturers is that a smaller quantity of medication is produced, which means there is more than one variation of treatment. Notably, the production of precision medicine requires facilities that are specialized and smaller than most factories. Although it has posed problems for manufacturers, this is a trend that’s expected to continue as methods used are refined. In fact, the number of investors that have embraced precision medicine has been higher than anticipated.
4. Integration of Blockchain Technology
As the use of blockchain technology has expanded in the financial arena, others have started to identify ways to use this innovation, including companies in the pharmaceutical industry. The primary purpose of blockchain technology is to simplify the way transactions occur, while also optimizing security and transparency without requiring a third party. When used by pharmaceutical companies, blockchain technology can help with boosting efficiency by streamlining processes. This applies to transactions that involve healthcare clinics, hospitals, regulators and other stakeholders. It can also maximize outcomes of research and development.
5. Digital Processes
The implementation of digital processes isn’t new. However, it is something that will gain momentum in the pharmaceutical industry. There are manual processes that currently exist simply because they have become the norm over the years. For instance, there are many paper processes that have been replaced by digital processes, which has enhanced operational efficiency and facilitated adherence to standard operating procedures with greater ease. This is a trend that will continue. It will also help to drive regulatory compliance. What many pharmaceutical companies appreciate about the implementation of digital processes is that the benefits far outweigh the costs. It also improves transparency and has the potential to mitigate the loss of data.
6. Smaller Production
As aforementioned, precision medicine requires the use of smaller manufacturing facilities, which is unlike what’s needed for the mass production of pharmaceuticals. As a result, there will be an increasing number of small production facilities. These smaller facilities are also due to a desire to produce a smaller number of medications that are of higher quality instead of producing a large quantity of drugs that are of lower quality. When a smaller number of medications are produced, they will obviously serve a smaller number of patients. Notably, some of the challenges associated with this model include the need to ensure maximum profits through fast production to accommodate demands.
7. Use of Cloud Technology
Anyone that has a computer at home or work is probably familiar with cloud technology by now. It has been embraced in the pharmaceutical industry and this is a trend that will continue. Cloud technology enables pharmaceutical companies to partner with multiple stakeholders with a greater level of effectiveness. Implementing a strong infrastructure using cloud technology also offers an opportunity to improve that integrity of data. There has been increased compliance with the good practice quality guidelines and regulations (GxP) as a result of applications used in the cloud. Just as this technology is expanding across all other industries, it will support pharmaceutical industry growth.
8. Discounts and Rebates
Periodically, the pricing of medications will hit the news circuit, especially when there is outrage about the high price of life-saving drugs. In an ongoing desire to reduce the cost of medications, there are governmental agencies, such as Health and Human Services, that will increase the offering of discounts and rebates. While there have been efforts in the past using approaches that are market-focused, these efforts are expected to expand. One thing that will continue in 2020 is the examination of drug prices and continued scrutiny to identify impropriety.
9. Digital Training
From an operational perspective, one of the trends that will grow in 2020 is the use of digital training to ensure the proper and efficient use of technologies implemented. This is also for the purpose of achieving regulatory compliance. As is the case in any other industry, employees within pharmaceutical companies and pharmacies must have keen knowledge of regulations and be able to navigate the different systems that are implemented in a way that complies with regulations. There’s also the issue of knowledge building for the purpose of maintaining high productivity and overall efficiency. The use of digital platforms for training is also cost-effective because you can train personnel on-demand at any time of the day or week.
10. Greater Focus on R&D Value
There is an increased focus on the value of medications. As a result, pharmaceutical companies are more concerned than ever about ensuring research and development hits the intended target. There is an effort to achieve greater effectiveness and efficiency to meet the needs of patients, while also protecting the bottom line. For instance, there is research designed to identify medications that can improve the experience and quality of life for patients in a way that’s more meaningful. This has required pharmaceutical companies to examine their research and development practices to ensure they are refined and focused.
These top trends are changing the pharmaceutical industry in ways that are transformative and likely to have both a short- and long-term impact. The level of innovation that’s taking place in the industry is likely to create tremendous value. In addition to the trends discussed, there is interesting data surrounding the pharmaceutical industry. Check out the statistics below:
5 Must-Know Statistics
- The pharmaceutical industry is expected to increase to $1.5 trillion by 2023.
- Approximately 38% of industry experts expect big data to have the greatest impact in the pharmaceutical industry.
- More than 450 medications were withdrawn over the past 25 years as a result of adverse reactions. This is one of the reasons why precision medicine is expected to be such an integral part of change in the industry.
- There are 66 biologic patents in the United States that will expire from 2020 to 2025. As a result, the FDA anticipates an increasing number of biosimilar applications.
- Pharmaceutical companies can sped up to $100 million per year on recalls that are linked to labeling mistakes.
Thanks for reading "Trends That Will Transform The Pharmaceutical Industry Outlook in 2020", by the Linchpin Team in Chicago, Raleigh, and Wake Forest.