In recent years the pharmaceutical industry has faced declining R&D productivity, a rapidly changing healthcare landscape and fierce competition from generics resulting in lower growth and profit margins. Historically, drug development focused on clinical trials management and outcomes. Now however, the industry is looking at more holistic approaches to improve processes of bring new products to market that can accelerate product development while lowering operational costs. This is challenging because of the complex value chain and business processes required in this highly regulated environment. Additionally, it has proven difficult for the industry to effectively adapt as many pharmaceutical companies are simply not optimized for cross functional collaboration which is so desperately needed to support these changing market conditions.
One meaningful and holistic approach to today’s current challenges within the pharmaceutical industry is to focus on Product Lifecycle Management (PLM), which is a business transformation approach to manage products and related information across the enterprise. In recent years PLM has provided many pharmaceutical organizations with the ability to increase their ability to get products to market quicker, ensure greater regulatory compliance and efficiencies while reducing development costs.
This white paper, published by Oracle, identifies some key business metrics that benchmark a company’s performance and key strategic business processes required to improve R&D performance through a PLM business transformation approach.
The Pharmaceuticals Industry faces three key challenges today—complex drug development process, large gaps between R&D operational performance and strategic importance and lastly, difficulty in managing clinical trial inventories.
Excel® are often utilised, resulting in unnecessary process and coordination complexity. Lack of precise coordination of the clinical trial inventory within the trial management plan is disruptive, adding considerable cost and time to this phase of product development (AMR). Consequently, key clinical supplies metrics routinely result in less than 25% of their targeted performance objectives.
This combination of poor execution of the R&D pipeline and compromised production efficiency of the initial clinical supply process results in inadequate R&D results (AMR). Industry metrics based on project timeline performance, project cost, expected financial margin, and market share capture, show that approximately only 1 in 3 programs achieve their expected performance targets.
While there are significant challenges within the pharmaceutical industry, opportunities exist in this increasingly competitive landscape for innovative companies looking for ways to transform their business that lead to profitability and growth.
Companies that successfully manage the transformation process to address these challenges will realize improved business performance Improving clinical development & manufacturing processes in pharmaceutical R&D organizations Oracle Pharmaceutical Solution Set Page 5 and differentiation in the market place as a result.
As companies look to speed up the process by which new products are brought through the development pipeline to commercialization while supporting new therapeutic areas, a business transformation focused on cross functional collaboration whereby product knowledge can be uniformly leveraged will result in both productivity and revenue gains.
It is also important to appreciate that even small incremental improvements can produce significant results in both revenue growth and margin (Oracle customer business cases). For example, for every day a company can reduce from the overall development cycle, they can realize significant reductions in cost and provide significant returns in both profitability and margins.