By Neil Saward, life science expert and Justine Johnston, agile expert, PA Consulting Group
Innovation is a critical capability for life sciences organizations to help them identify and bring new life-saving treatments to patients. According to results from PA’s 2015 innovation survey, which includes input from more than 750 senior executives from organizations across multiple industry segments, the life sciences sector is leading the pack when it comes to innovation.
Indeed, the real-world outcomes would also suggest that life sciences organizations are improving their success at bringing new treatments to market. The FDA’s Center for Drug Evaluation and Research (CDER) approves hundreds of new drugs each year, and while the majority are variations on previously approved products, a small subset are novel drugs, which are truly innovative products that help advance clinical care. According to the FDA Novel Drugs Summary 2015 (see graph on page 54), the number of novel drug approvals has been slowly increasing over the last decade from 22 in 2006 to more than 40 in both 2014 and 2015.
However, based on industry research, it is clear that even life sciences organizations have room for improvement, and the value of getting innovation right will improve the quality of life for thousands of patients and potentially generate hundreds of millions of dollars in revenue for organizations.
A key first step to help life sciences companies improve their innovation success is understanding the Agile approach and the ways in which life sciences organizations can implement Agile to increase organizational agility and innovation. So what is Agile? It is an approach to implementation, which is rooted in software development. Agile is characterized by iterative design-build-test cycles, scope that changes to reflect changing priorities and frequent delivery of software, rather than the more traditional one-off delivery at the end of a project.
Ultimately, Agile can play an important role in helping life sciences organizations deliver new innovative products to the market faster and in a more cost-effective and streamlined manner. It is an approach that is already being used at some life sciences organizations, and the results speak for themselves. Take, for example, a top five pharma company that recently adopted Agile. After just one year, the switch to Agile resulted in more than $13 million in savings from a small subset of projects, and also enabled a reduction in drug development time scales.
AGILE IS NOT JUST FOR IT
Agile had its origins in software development and quickly proved itself within technology companies as a driver of innovation, quality, and flexibility. As a result, more and more enterprises are now adopting Agile outside of IT to increase organizational agility and innovation. Organizational agility could mean different things to different companies. It could be, for instance, an ambition to increase boundary spanning agility (i.e., the ability to acquire an innovative biotech startup and integrate it rapidly) or to be able to have business model agility (i.e., think budget airlines and their ability to apply differing pricing models rapidly). Despite the differing ways of defining organizational agility, one thing remains clear: Organizations are looking to increase organizational agility to help them release value earlier
For life sciences companies specifically, opportunities exist for organizational agility across the drug development life cycle by taking a systems view, removing unnecessary complexity, and changing mindsets. Consider this: a top-five pharmaceutical company was developing a non-small cell lung cancer drug, and by using an Agile approach, they were able to reach Phase 3 clinical trials in two thirds of the projected time.
PLACING INNOVATION AT THE HEART OF THE ORGANIZATION
Agile is more of a cultural shift than a technical one. Agile’s true strength is being able to release the inner energy of teams via the creation of a collaborative culture — one where cross functional teams are given the autonomy to experiment, to continually improve, and to learn from failures. Teams that have fun, autonomy, and purpose are more likely to innovate themselves — a top-down mandate will not achieve the same outcome. Agile techniques, such as retrospectives where teams identify what has worked well, what hasn’t, and agree on changes to implement, ensure that teams regularly reflect on how to become more effective.
Technology plays a key role in enabling this culture. As an example, a global pharmaceutical company was able to leverage smarter devices and ways of working to support collaboration. This included the use of smart whiteboards that transmitted in real time to other regions, as well as open rooms with always-on video connections, which allowed them to link up Agile teams across different locations.
LEARNING QUICKLY FROM FAILURE
Failing fast is not a new concept. In fact, actively seeking opportunities where knowledge and skills are stretched to the limit in order to learn quickly is a wellknown technique. However, many organizations are still reluctant to endorse failure of any kind. According to the 9th State of Agile Survey, Agile can help translate ideas into reality up to 61 percent cheaper and 24 percent more quickly than more traditional delivery methods, enabling organizations to learn faster and more frugally. Again, some life sciences companies are already benefiting from the implementation of the Agile approach. For example, at a large global pharmaceutical company, this was demonstrated in a program where early experimentation showed that the enterprise-data migration tool would be unable to cope with the forecast data volumes. This early knowledge allowed the company to avoid cost of rework and delays.
HARNESS TECHNOLOGY MORE EFFECTIVELY
Technology is a key enabler of both innovation and bringing treatments to market more quickly. However, too many technology projects still fail to deliver on their goals. Some of the underlying techniques within Agile can help to support more effective deployment of technology, including working in short cycles (known as iterations), early and more frequent engagement with customers, and holding demonstrations at the end of every iteration to show stakeholders progress and to receive feedback.
Together, these techniques all help ensure that the most valuable work is being addressed first, as well as encouraging inspection, adaption, and transparency on a regular basis. Confronting risk early should also be top of mind, with the ambition to significantly reduce a project’s risk profile with each iteration.
IMPLEMENTING AGILE TO KICK-START INNOVATION
The life sciences industry is complex, due to regulatory changes, new entrants to the industry, and the pressure involved in bringing new drugs to market quickly and efficiently. Implementing the Agile approach can help life sciences organizations innovate to meet these challenges while also reducing costs. In short, companies can see a step-change in their innovation capabilities by adopting and extending Agile beyond IT, moving to an Agile culture, embracing the benefits of failing fast, and digitizing more effectively.