Should pharmaceutical companies dip their toes or better yet move their head quarters in Silicon Valley in order to be closer to digital disruption?
So many industries have faced disruptions from technology driven start – ups and pharmaceutical companies I believe will be no exclusion to digital disruption. They may feel they are well protected, mainly due to the regulatory and compliance environment they operate in, but they are also burdened by old business models, complicated processes, multiple layers of approval and above all their aversion to risk taking. Pharma companies can benefit from learning from the innovative culture that is so embedded in Silicon Valley, but this comes along with a change in mind-set of legacy C-level and it’s employees.
Does pharmaceutical need a digital disruption?
Absolutely yes. They have traditionally and continue to this very day to “push” information out to their customers (doctors, patients/consumers/ payers). Whereas, today it is required that pharmaceutical companies adopt a more interactive experience or strategy with the consumer. That is they must learn to engage with the consumer.
What would be the payoff of engaging with Silicon Valley?
The payoff could be substantial. For one thing, pharmaceutical companies could learn more about the entrepreneurial (a culture of innovation) approach. An entrepreneurial approach would allow for disruption of present day business models and embrace learning through trial and failure. Second benefit would be to digitalize all of pharma’s present day silos (sales, marketing, medical etc). Third payoff, I believe pharma would learn to be more consumer / customer focused. Who is the true customer today for pharma? In today’s world it is not only the doctor.
How can pharma tap in or engage with Silicon Valley?
The easiest would be to simply visit for a few days and shadow some of the industries in Silicon valley. See the YouTube video below of one companies experience. Another possibility would be to form partnerships. One excellent example already underway is Google and the Swiss pharmaceutical company Novartis. Google and Novartis are working together in developing contact lenses that can monitor the glucose levels in diabetic patients. Open offices in Silicon Valley which would allow or facilitate to tap into local talent and cultivate a more innovate culture away from legacy,Wall Street, operations.
Here is an example of one company that visited Silicon Valley and their learnings.
How can this knowledge be incorporated back in headquarters?
Traditional company leaders can immerse themselves in Silicon Valley’s culture of innovation approach, that is all fine and dandy. But, once they get back to headquarters they need to be the agents of change. Continue with that “culture of innovation” of being open-minded and listen to the right people. There is not only senior level responsibility, this learning experience needs to be extended to heads of different departments such sales, marketing, medical. The question that pharma needs to ask itself is how well aligned is top management about the challenges on the horizon and what needs to be done to overcome these new challenges.
Does pharmaceutical face a future in which unprecedented technological change could disrupt legacy operations or business models?
The list of dead companies is pretty long and their stories tell it all. The failure of not responding to technology is a mistake one does not want make.