6 Life Science Industry Challenges You Must Be Aware Of
May 26, 2016
The life sciences field is experiencing a phase of immense potential, tempered by a number of significant industry challenges. On the positive side, R&D, expanding markets and innovative funding schemes and technologies are driving growth. However, complicated regulatory compliance, inadequate funding and increasing competition are a few of the factors impacting on the bottom line.
According to a comprehensive study by Deloitte, there are six major challenges currently facing the life sciences market, which companies need to address in order to make the most of the existing opportunities and consolidate strength for the future.
1. Demographic challenges.
The population is growing, aging and sickening, with a significant rise in chronic diseases and a focus on communicable diseases across the globe. Additionally, consumers are more informed and demanding than ever before.This demographic situation presents both opportunity and challenge for the industry: on the one hand life science products, technologies and expertise have never been so needed, yet there are also many obstacles to be negotiated, such as cost containment, a vast number of diseases competing for drug funding allocation, and differing health care facilities and capabilities across the globe.
2. Financial challenges.
Life sciences research and development is extremely expensive, and few governments can sufficiently fund the field as costs rise, particularly in times of economic stress. Government funding varies immensely between countries, with the US governments spend per head surpassing $11,000 a year, while the respective allocation in Pakistan is $58 per year.
In addition to public underfunding, the rise of generic medications and patent cliffs are also impacting on company profits. The combination of these financial pressures is requiring life sciences companies to look into innovative public/private partnerships and alternative financial models, and there is a lot of movement in this sector.
3. Regulatory compliance.
The regulatory landscape for life science products and technologies is complex and ever-changing, with companies required to meet strict guidelines that can differ significantly across countries. As life science companies strive to innovate and provide new drugs and solutions, they are often operating on new ground where no regulation has existed before and is being made up ‘on the run’.
Keeping abreast of every legal nuance of regulation is a top priority for pharma and biotech firms, who understand that a compliance failure can destroy their product, their brand name and customer’s health outcomes. Companies are being urged to implement a strategy encouraging constant readiness for compliance inspections, diversify the talent pipeline, cultivate ethical behaviour in employees, building compliance into all aspects of the business and across all local operations, and using big data to assess and predict risks.
4. Innovation challenges.
It is not just the drugs that are changing with innovation- it’s also the way they are delivered. Health services and products are increasingly customised to the individual, with a future focus on genetics and health information.
Life sciences companies are being challenged to adapt to a new health landscape where electronic records and wearable health-related technology are changing the way the business of health operates.
5. Operational challenges.
With funding tight and the health industry undergoing rapid change, rising to operational challenges has never been more important. Creating solid health infrastructure, attracting and retaining talent, and reducing waste are focal challenges of the life sciences field.
Whether it’s using new technologies, analysing big data or creating alliances across health services, the life sciences industry is being forced to adapt its operational procedures to adapt to the current market and drive profits.
6. Local challenges.
Life sciences operates in a truly global market, and companies are required to operate at both the global and local levels. Each country has differing health infrastructure, funding, personnel, regulatory and delivery systems that companies need to operate within and understand the local intricacies of each of its markets.
The Life Science field is competitive and exciting with some real challenges on its doorstep. An industry so well known for innovation must be well-poised to rise to these challenges- and the companies who do so the best will be the ones that succeed in the decades to come.