Vertical pharma: How sector convergence can erase digital health siloes

Life science companies must evolve and find new ways of working that erase the lines between industries and sub-sectors if they are to adapt to the digitalised world. That’s according to the team at Sweden’s Sahlgrenska Science Park, who are getting ready to host a virtual event looking at how the specialisation of digital expertise is driving a trend of sector convergence that pharma is only just cottoning on to.

Mia Ekdahl, head of communications at the park, says: “Industries – certainly the ICT and mobility industries – are getting closer and closer to traditional life sciences, and now life science companies are waking up to a world in which they, to a certain extent, have been bypassed.

The “biggest piece of the puzzle” is digital health, which has seen an influx of non-health related companies, she says – using Volvo’s increased ambitions in the digital health space as an example.

Rising above siloes

Traditional structures and frameworks have been holding life sciences companies back, but the COVID-induced acceleration of digital transformation is starting to change all that.

“You can see how big pharma and big medtech companies are slowly becoming more digitalised, but it’s perhaps one of the last sectors to really embrace it.

“The sense of ‘not invented here’ that you see in healthcare, pharma and medtech globally has made the field very siloed. I think that’s the main reason why health tech or digital health has been a sector on its own for so long,” says Ekdahl.

Now that the industry has big names from rival industries nipping at its heels, there is “no turning back”, says Ekdahl, who believes many of the traditional “siloes” will be wiped out in the next five years or so.

“It’s a question of ‘when’ rather than ‘if’ we will stop talking about digital health as a separate entity. Companies will be less defined as pharma or biotechs and more be a little bit of everything”

“From our point of view, it’s a question of ‘when’ rather than ‘if’ we will stop talking about digital health and/or health tech as separate entities. Companies will be less defined as pharma or biotechs and more be a little bit of everything.

“Today, big pharma and medtech companies are more and more structured around collaborations with other industries and even with each other. The siloed world of the past is long gone already.”

Collaboration does more than just help pharma stay competitive. It helps the industry as a whole join forces and tackle the big issues of the day, she adds.

“We’ve come so far in developing solutions for many big disease areas and healthcare. But to get beyond incremental changes into something that really alters perspectives, you have to work with others — nobody can know everything.”

Practical steps

Asked how companies were encouraging this convergence – and the benefits it could bring — Ekdahl highlights recruitment, education, and regulation.

“It’s about looking beyond your own industry, because the knowledge and experience you need can come from completely different sectors. The life sciences industry has slowly started to do that when it comes to digitalization, realising that the AI experts or data scientists are some of the most sought-after specialists, irrespective of what industry they work in.”

Closer collaboration with universities and academia is another trend, says Ekdahl, adding that the University of Gothenburg, as an example, is currently working with the university hospital and a technical college to provide doctors with a specialised digitalisation training programme.

In a report published last year, the Sahlgrenska team also highlighted AstraZeneca’s (AZ) BioVentureHub, also in Gothenburg, which is home to more than 30 R&D-focused companies.

“The hub is looking to attract high-calibre groups active in areas aligned to AZ’s strategy, as well as biotech and medtech companies that could gain a competitive advantage by tapping into AZ’s expertise and infrastructure,” says the document, Sector Convergence: A significant growth opportunity.

Innovation versus regulation

While most industries will say they are unique, pharma is, perhaps “more unique than others” thanks to its heavily regulated nature, Ekdahl says.

“It’s an industry driven by regulatory and payer demands, and we don’t want to skip any of that. We are talking about human beings.

“But when regulatory requirements and payer demands get in the way of making things better, because the innovation comes from industries that don’t know how to play the game, how can we deal with that?”

Pooling the digital expertise of other sectors with pharma’s in-depth knowledge of robust, evidence-based development ensures projects get the best of both worlds.

Another consideration, Ekdahl says, is focusing on improving health rather than treating disease.

“If we are moving towards prevention and trying to fix the underlying causes which may develop into a disease, rather than treating the symptoms of a disease – that changes the whole set up of the industry,” she says.

Rather than making a slew of companies that all do the same thing, sector convergence is about inspiring next generation industries by fostering collaboration and sharing ideas, and with the cross-fertilisation of knowledge, she explains.

And while pharma, with its masses of regulation and risk-averse approach, may have been one of the last to join the trend, with the right strategy and vision, it could have the most to gain.

pharmaphorum’s founder Dr Paul Tunnah will be speaking about sector convergence at the Sahlgrenska Science Park’s virtual Park Annual 2020 event on 1 October. For more information visit the Park’s website.