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Joaquim Cardoso MSc.
Servant Leader, Chief Research & Strategy Officer (CRSO),
Editor in Chief and Senior Advisor
January 22, 2024
This executive summary is based on the article “How to make 2024 a banner year for biopharma, despite the headwinds”, published by PharmaVoice and written by Michael Gibney, on January 18, 2024.
What is the message?
In the face of challenges such as drug pricing regulations, uncertain investments, and impending patent cliffs, the biopharma industry is poised to make 2024 a transformative year.
Creative thinking, purposeful investment, trust-building, and technology adoption emerge as key strategies to navigate these hurdles.
ONE PAGE SUMMARY
What are the key points?
Reinventing Investment Strategies
Navigating Post-Pandemic Markets: Realizing returns on investment becomes challenging despite increased R&D. PwC suggests differentiation in investments and seeking “white space” in less-saturated markets.
M&A Surge and Value Addition: M&A activities are expected to surge after a slowdown during the pandemic, with a focus on ensuring value addition, especially in oncology, where valuations have soared.
Building Trust and Mitigating Risk
Compelling Growth Narratives: Companies must construct compelling growth narratives to attract investor confidence. Trust requires anticipating threats and managing risks, emphasizing “protecting the enterprise” (PwC).
Improving Patient Lives: EY underscores the importance of improving patient lives to mitigate risks like regulatory scrutiny and pricing crackdowns.
Embracing Changing Technology:
Adapting to Tech Trends: Biopharma companies need to adapt to evolving technology trends for long-term success. AI and advanced analytics offer speedier drug development and market opportunities.
Strategic Technology Budgets: Nine out of 10 companies plan to increase their technology budgets in 2024, focusing on using digital technology strategically rather than for its own sake.
What are the key statistics?
Life sciences M&A rose by 34% from 2022 to $191 billion in 2023, signaling a return to dealmaking, particularly among pharma giants.
90% of companies in the industry are boosting their technology budgets in 2024.
What are the key examples?
Valuation Challenges in Oncology: Oncology acquisitions, averaging almost 12 times the target company revenue, highlight the need for acquirers to ensure genuine value addition.
AI and Analytics Impact: PwC’s statistics on AI automation and analytics demonstrate potential reductions in process timelines, operational costs, and project delivery timelines.
Conclusion
The year 2024 presents the biopharma industry with an opportunity to thrive amidst challenges. By reinventing investment approaches, focusing on building trust through improved patient outcomes, and embracing technological advancements strategically, companies can set the stage for competing differently in the years ahead.
Creative thinking and purposeful innovation will be essential to reshape business models and achieve success in the ever-evolving landscape of 2024 and beyond.
To read the original publication, click here.
