Magazine Article | August 1, 2016

Identify New Revenue Streams Via Strategic Consulting Partners

Source: Life Science Leader

By Cindy Dubin, Contributing Writer

The life sciences industry is evolving and depending more on external partners, such as strategic consultants, who know what has worked well in other industries. According to the study IDC MarketScape: Worldwide Life Science R&D Strategic Consulting Services 2016 Vendor Assessment, strategic consulting includes high-level management consulting and advisory services, operation and process development and implementation services, and technology adoption and implementation. This is the final installment of the market intelligence group’s three-part series on the topic.

This study seeks to compare major service providers with each other based on criteria important to life sciences companies when selecting a strategic consulting partner.

“The historical business model for a life sciences company was to identify a new drug, run it through the process, commercialize it, and then start selling,” says Alan Louie, Ph.D., research director of International Data Corp. (IDC). “Now we are saying it doesn’t necessarily stop at the point of approval. Like other industries, life sciences companies are looking at working downstream from drug approval to gain additional revenue.”

For example, Pfizer and IBM (one of the strategic partners highlighted in the IDC study) announced a research collaboration to develop innovative remote monitoring solutions aimed at transforming how clinicians deliver care to patients suffering from Parkinson’s disease. The experimental approach will rely on a system of sensors, mobile devices, and machine learning to provide real-time, around-the-clock disease symptom data to clinicians and researchers. The ultimate goal is to obtain a better understanding of a patient’s disease progression and medication response to help inform treatment decisions and clinical trial design, while also speeding the development of new therapeutic options.

“The ability to monitor the disease by measuring tremors can give us an early indication if a treatment is working and whether the disease is progressing,” says Louie. “Now, Pfizer is not just looking for that next magic pill to cure the disease but instead looking at a completely new business model. An idealized outcome of that collaboration would be for Pfizer to sell drugs, monitoring devices, and services to capture the Parkinson’s disease franchise and set up the company as the ‘go-to’ company in that field.”

He adds, “Life sciences companies historically don’t have a lot of experience figuring out new ways of expanding their boundaries. An external partner can help to advance and implement those approaches to deliver powerful benefits.”

"Like other industries, life sciences companies are looking at working downstream from drug approval to gain additional revenue."

Alan Louie, Ph.D.
International Data Corp. (IDC)


Another powerful benefit of working with a strategic partner, according to Louie, is their knowledge of technology innovation and how to use technology to capture data that can further help with understanding a disease. The advent of electronic medical records, for instance, puts patient data together with research and clinical trial data to see what makes sense in terms of how medical data may provide deeper insights into new drugs being investigated. Partners can help companies gain access to this information and incorporate the data into their existing processes.

“From an operational standpoint, clinical trials will likely be conducted differently based on these new data and processes,” Louie says. “How do you compile all that data? Because the comprehensive data standards are not yet in place, you can easily compare apples to oranges and get the wrong answer. Effective use of technology enables you to more systematically use all available data.”

According to the IDC study, with science, technology, and IT knowledge components increasingly becoming part of strategic relationships, IT service providers are also gaining traction in winning strategic consultant engagements where operational and tactical knowledge and experience are relevant. Key areas include analytics (i.e., predictive modeling) and technology adoption and implementation (e.g., mobile, cloud, Big Data, social media).

When narrowing down the list of prospective partners, consider the following criteria:

  • breadth of the life sciences service offered and depth of industry-specific knowledge
  • geographical footprint
  • investment in life sciences- and/or technology-specific areas
  • financial stability
  • ability to accommodate different types and sizes of life sciences clients
  • customer references about overall value and ability to deliver.

Louie stresses, however, that this is a partnership, which assumes that both sides bring something to the table. The consultant brings a certain skillset, and the life sciences company brings knowledge about its therapeutic focus.

Many of these partnerships revolve around strategic initiatives with a short time frame and well-defined milestones. “This helps with ROI justification,” Louie says.