In April 2019, The Barton Partnership hosted a roundtable in Singapore focussing on the Healthcare & Pharma space. The evening was a great success and a variety of topics were discussed which we have summarised below.
Different approaches to Strategy:
- Depending on how strategy is perceived in each organization, companies have either centralized/ decentralized organizational structure.
- As generic brand products tend to compete directly with local brands, strategy needs to be market-specific. For the non-generic products the strategy tends to be more centralized at HQ.
- Singapore is typically in a regional HQ role and therefore the strategy that is discussed here is more commercial (e.g. market penetration) and the strategy teams here are smaller in size. The “more exciting” / innovative / “more impactful” strategy takes place in Headquarters or in R&D centric locations like US.
- Novartis is betting heavily on AI and digital - primarily in factory /production, patient journey and finance parts of the business. It’s still too early to show results but it looks promising.
- The large MNCs aren’t efficient when introducing new technology. The start-ups, are more nimble, therefore more effective when transforming.
- AI does not answer questions, it only find patterns. So if you want to find answers, you need hear your customers. That is the best thing a company can do.
- Large organizations don’t have the patience for true disruption and are too KPI focused. Because of the nature of the industry there is also a tendency to ask for permission, while the likes of Uber apologizes afterwards.
- The best new drugs come from small companies, which is why 50% of Novartis’ revenue comes from inorganic growth.
- Pharma companies do not address their consumers because they are often focused on doctors and regulators. Every company should have a Chief Patient Officer.
Future of the industry in the region:
- China will set the trend in the region- It has guaranteed volume. They will increase accessibility of healthcare. At the moment they are opening up and allowing access for innovation but there is always a risk that they become more protectionist in future. However, the current narrative is reassuring.
- VIP countries (Vietnam, Indonesia, & Philippines) are emerging markets with a lot of appetite for growth, and a need for healthcare accessibility and improvement. They will be key in the sector’s development in the region.