After a few recent client meetings I’ve begun to reflect not just about the challenges facing pharma, but the nature of those challenges. More specifically, I wonder if they reflect normal cyclical ups and downs or the impact of social and political evolution? Or do they represent a secular change?
I happen to believe we’re at the cusp of a secular change in pharma, one of those major paradigm shifts in an industry that only happens once every 10 or 20 years, or once every generation. A shift in which the industry will experience a major transformation. Retail is going through a change like this, energy is in the middle of transformational change, and I think this is also happening to pharma right now. No political or regulatory or scientific shifts will bring back the good old days of pharma.
Impact of Secular Change
Jim Collins has written extensively about what happens when massive change hits an industry. When it all shakes out, there are a handful of companies that are the undisputed leaders, while the majority simply meander in the middle of the bell curve.
We don’t need to recite here the product, access and margin pressures our industry faces – everybody knows that the power center is shifting. The real question now is, how do we control, channel and predict that change? Or do we just let it happen to ourselves?
Many people that I talk to within pharma are pretty discouraged, because they feel like their companies are slow and morbid and there’s too much inertia to really make change happen. Yet, when I talk to people at the most senior levels, they do want to make change happen, but feel constrained by the mid- and lower levels. Oftentimes, when the senior level tries to make change happen, the people at the mid- and lower levels dig in their heels. It’s reminiscent of when politicians try to make significant changes and the civil servants respond, “Well, he’ll only be around for a few years, and then we’ll go back to business as usual.” In some ways, that attitude prevails in pharma.