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The CEO’s Perspective of the Complex Business Universe
TECHNOLOGY
Economic Growth
Emerging Trends & Process
Technology
Competitive Issues BEST
Benchmarking
PRACTICES
Emerging External
Competition Industry
GLOBAL
Impact
Emerging INDUSTRY Career
Opportunities Development
Cultural
Industry
Non Integration
Customer
7. PESTLE Analysis
Industry Outlook
Healthcare Paradigm Shift
PESTLE Analysis
Opportunity Analysis
High Impact
Power Patient
Generation
Drugs get
Smarter
Shift to Personalised
Healthcare
Innovation vs. Prevention Before
Knowledge Cure
Healthcare globe
trotters
Projected Patients become
Impact on the Customers
Healthcare
Cyber Docs
Industry
Hospitals go Virtual
Devices become
monitors, monitors
become devices
Low Impact
Low High
Certainty
Prevention
3 Before Cure
Early Treatment Implementation of IT Precise therapy becomes reality
Personalised Genetic Testing Information based medicine Wellness Care Presymptomatic diagnostics
4 Healthcare Targeted Clinical Trials Major diseases understood at molecular level & treatments
Healthcare Immediate Treatment abroad "medical tourism" crosses Private Companies invest in
5 Globe Trotters becomes an option the US$2 billion mark facilities and services abroad
Innovation vs.
8 Knowledge War for Medical Talent Baby Boomer Retirement Starts Medical professionals keep
up with knowledge growth.
9 Devices Become
Monitors Disease management Remote Patient Monitoring Self-monitoring
In almost all countries worldwide, per capita healthcare spending is rising faster than per capita income.
No country can spend an ever-rising share of its output on health care, indefinitely. Spending growth must eventually fall in
line with growth in per capita income.
Predictive tests
Remote Patient Monitoring
Gene Mapping &
Functional Analysis
Preventative Programmes Life Sciences
Nanotechnology
IT / Digital Information Systems
Delivery Systems
Technology…….Enables it
Economics………………Require it
Demographics………….Demand it
Medical Medical
Devices Technologies
Telehealth
Patient Appears for virtual
(falls sick) interactions
Patient is treated
“find it and fix it”
Patient is discharged Web portals
to EHR Sharable
Systems Personal
Patient then disappears from radar screen
Health
Patient Scan Records
Good Chronic
Disease care
System oriented to acute illness
Patient’s role not emphasised
Patient Provider
Follow up sporadic Support Support
Tools Tools
Prevention overlooked
Home monitoring devices Electronics Health Records (EHRs)
Personal Health Records Chronic Disease Management Systems
Web- based education and support Personal Digital Assistants
Disease Management Program
...From ...To
Therapeutics/Diagnostics/ “Theranostics”
Devices Tools
Web of Care
NanoCare
Mobile EHR
Implantable eCare
Smart eHomes
Wearable BioSensors
EcoMedicine
Doctors
Friends
NanoMedicine & Medical
&
Team
Family
eHealth
Pre-emptive Medicine Advisor
Network
Coaches Online
Support
Regenerative Medicine &
Advocates Communities
Digital Medicine
Hong Kong
Germany/Switzerland High government
U.S. High spending on spending on
Huge healthcare healthcare, large market with healthcare, small
market and not too many market domestic
growing, large players, increasing focus on market, gateway to
opportunities, niche eHealth and digitization China
players will be more India
successful Large market, low operating costs, excellent
local skills, high local
competition, Distribution hub to the Middle-
and South-East of Asia
Venezuela & Colombia
Constituting part of the
Andean Region are the
fastest growing countries
in many HC categories
due to large public
investment Sub-Saharan Africa
Limited current government
spending on healthcare Australia & New Zealand
IT, increases planned in the High government spending on
Brazil & Mexico
future. Private sector healthcare IT, small number of local
Two largest healthcare
developing increasing focus market players, increasing focus on
markets in Latin America and
on eHealth. Moderate number eHealth and digitization
growing at a sustained pace
of players mainly operating
from South Africa.
High Revenues
Pharmaceuticals
Projected
Revenues
In 2012
($ Billions)
Medical Devices
Drug Discovery Biotech
Low Revenues Clinical Diagnostics
Patient Monitoring Healthcare IT
Medical Imaging
Low High
Key Trends
Global
Emerging Markets
Pharmaceutical &
Biotechnology
Trends
Integrated Model,
Pharmaceuticals, Biotech, Generics, Gene Therapy,
Blockbuster Model Local Players Global Players
2020
Integrated packages of products and services Supply chain functions will evolve to a revenue
generating model. Products and services will be
Patient monitoring & compliance
marketed through the supply chain
Pharma and medical devices providing
Just –in time manufacturing, novel delivery
sophisticated and efficacious solutions
methods and direct to consumer distribution will
Integration of pharma, diagnostics, medical be adapted from other industries like the
devices, patient monitoring and healthcare IT automotive industry
9 Will result in a high profile, risk free, user Automated dispensing of drugs
friendly, low cost and safe healthcare solution
Smart cards / internet to store patients details
High Revenues
Established
Treatments
Low Revenues
Low High
Growth Rate (2007-2012)
US US US US Decreasing number
14 drugs lose patent protection Five major drugs lose The US patent for Lipitor Patent protection expires for 10
of small molecule
(include super blockbusters patent protection expires and for 12 other major drugs in the US (includes
drugs (includes the the superblockbusters Seroquel patent expires
Effexor and Fosamax, and (includes Prevacid)
blockbusters Levaquin, and Zyprexa, plus three other beyond 2013
potentially Advair)
Cozaar and Protonix) blockbusters)
EU Biologics will be the
Nine drugs lose patent EU focus within hospitals
protection in at least one of the Seven drugs lose patent EU EU in the injectables field
major European countries protection in at least one Five drugs become exposed Four of these, including
(including both Fosamax and of the major countries to generic competition with Zyprexa, lose patent protection Within the EU and US,
Effexor) (including Nexium, Keppra the most significant in three major European
there is increasing
Pantozol and Cozaar) of these countries, as do seven other
drugs, most notably Lipitor in competition from low
November 2011 cost competitors
Market Size (2007-2012)
Source: IMS
© 2008 Frost & Sullivan, All rights reserved www.frost.com
Gene Therapy will Drive the Market in the Longer Term. Technologies such as
Diagram
Pervasive computing are Important in Improving the Drug Discovery Process.
Smart
Tags
Petaflop Predictive
& Grid biosimulation
computing Future
Technology
Trends Advanced
Defining diseases more Pervasive
accurately and creating Gene therapy uses genes to treat or computing storage
prevent disease. In the future, this solutions
healthcare packages for
technique will allow doctors to treat a Web-scale
patients with specific disease
disorder by inserting a gene into a mining
subtypes. Resulting in
Premium Drugs and the patient’s cells instead of using drugs
launch of health care kiosks or surgery
A disease led approach creates a new discovery and
Opportunities
offering one-stop-shop development model. Technology will improve the process e.g.
services making in-life testing more cost efficient. This brings
significant changes for pharma companies in terms of time,
development costs and success rates to man.
Genomics /
Gene
Proteomics
Cellomics Therapy,
Biologics: Targeted
Treatment
Solutions, Integrated
Semi Block Solutions
Busters, Patent
Expiration
Strategies
Growth Rate
Brazil
Latin American hub for FDI and
exports to neighboring nations
Government policies favour
generics use – branded drugs’
revenues are low Korea
Recognized potential for CRO and Innovative capability
CMO growth – still in and well developed
development phase India
industry
Highly skilled labor and low costs – attractive
market for partnerships (CRO, CMO) (APIs)
Pharmaceutical companies with global presence
US FDA approved labs – preferred destination
for R&D outsourcing
Weak IP protection – a concern
Argentina
Approval of ‘Generics law’-
patients choose between
branded and generic drugs Singapore
Key Trends
Clinical Diagnostics
Trends
Integrated with
Neglected sector Hottest area other HC sectors
2015
Home Care/ Self Testing
Pharmaceutical /
Patient Driven Biotechnology
Available personalised healthcare and choice
Patient knowledge through multiple channels
Public pressure on government Information IVD
Imaging
Technology
One stop shop
Consumer responsive providers, products and services.
High Revenues
Projected
Revenues In
2012
Low Revenues
Low High
Growth Rate (2007-2012)
Pharmacogenomics
Molecular Testing
Efficient Decision Making
and Optimisation of
Cancer Testing
Treatments through POCT
Growth Rate
Key Trends
Medical Devices
Snapshot
2010
Comfort, mobility & safety, efficiency,
One-stop combination solutions The ambulatory, homecare and public access
Opportunity market expands rapidly
High Revenues
Projected
Revenues In
2012
Low Revenues
Low High
Growth Rate (2007-2012)
Raw Markets
Developing/Growing Markets
Disease management
Patient
vs. device centred
Therapeutic Device
Medical Procedure
Scandinavia
Initial Event
Russia
At Risk
Ireland
UK
Wellness Poland
Germany
Czech
Future France
Republic
Hungary
Tissue engineering and combination devices. Merging
devices with biological elements Croatia Serbia
Italy
Implanted diagnostics and monitors enabled by sensors Albania
Disease management approach
Novel drug delivery platforms in unmet needs and
indications – Hep C, Chronic Pain, Depression
© 2008 Frost & Sullivan, All rights reserved www.frost.com
Taking Stock and Looking Forward: PEST Analysis
Key Trends
Key Opportunities
Global
Future
Medical
Technologies
Trends
Medical
2010
Imaging
Multimodality Systems Patient
Mobile/Roaming PACS Monitoring
2007 2007
Networked Modular Systems Clinical Systems
Patient
2010 2010
Healthcare Next Generation Integrated
Monitoring
Move from Critical Care
IT
towards Sub Acute Care Clinical & Financial Systems
2015 2015
Monitoring of Patients at Home Personal Health Management
Systems & Tools
High Revenues
Projected
Revenues In
2012
Low Revenues
Low High
Growth Rate (2007-2012)
Semantic
9 While “return on investment” Grid Computing Interoperability
remains a critical factor for Health
organizations when deciding IT
Data Lifecycle
Bluetooth
investments, it will not become the Management
Wireless
2012-2020 Networking
sole factor in determining the value
of IT on service quality or outcomes.
Service Oriented
Architecture RFID
Home Health
Services HL7 V3 Messages
Business Process
Management
Distributed
Antenna Systems 9 Home healthcare could evolve from a
Biometrics
Speech Recognition
sporadic practice today to a
Electronic Data
mainstream care delivery model in the
Interchange Hand-writing
Recognition
next 5-10 years.
2007-2012
Natural Language
9 Services like Online
Tablet PCs
& PDAs Processing Consultations, In-home Vital Signs
Monitoring and Online Disease
VoIP Context Management
CCOW Protocol Management increasingly gaining
Enterprise MPI momentum.
Foster
Adoption
Enable Policies Encourage Large
Scale Pilots
Exa Bytes
Integration Images for On the Move
Context Based Medicine Data Access
2020 2020
3D – 4D Images
Enterprise-wide PACS
Video Images
2015 2015
Image management
tools and services to
contribute to greater
market share.
Modality markets not
likely to show
considerable growth
Australia
Argentina HealthConnect developing a
South Africa
Focus on digital National Information
radiography. EHR No EHR – but Network.
infrastructure being New Zealand
also being
considered developed. National EHR
system in place
2. Patients become Customers: Customer services become a defining factor for the choice of providers, products and
services. “In short, it is the healthcare payers, not the drug makers, that are now defining the threshold of innovation”.
3. Prevention Before Cure: Investing in early diagnostic tools and implementing modern IT systems to manage and deliver
information, and introduce treatment earlier, so therapy can be more precise.
4. Shift to Personalised Healthcare: Emerging of extremely specialised and highly personalised treatments based on
individual’s genetic make-up.
5. Healthcare globe trotters: Numerous countries are actively developing and promoting their medical capabilities in
response to medical tourism. Cost of comparable treatment in South & West Asia i.e. India is on average between 10-
20% of those in the West.
7. Hospitals go Virtual: Hospitals breaking physical silos to create virtual care networks. Bio connectivity devices become
the standard.
8. Innovation vs. Knowledge: Cutting edge research offer novel methodologies, treatments and drugs faster than ever
before. Pace of knowledge grow is outstripping the amount and quality of skills set.
9. Devices become monitors, monitors become devices: Internet connected medical devices enter the healthcare
industry. A furious pace of innovation comes to dominate the healthcare device and medical technology industries.
10. CyberDocs: nonhuman intelligence agents, will dispense medical care to patients and doctors worldwide to save money
and share expertise.
Global Mortality
Cardiovascular Disease
Secondary prevention measures
New threats to health like Pandemic and new therapies are shifting
avian flu and SARS treatment from inpatient to
ambulatory care setting.
Respiratory Disease
No major treatment improvements
on the horizon. Unmet needs
exist.
Diabetes
Source : SG Cowen Cell therapy, better monitoring
and new pharmacological
Others: Include Transplant, Sleep Disorders, Alzheimer's, Incontinence, Orphan treatments should reduce
Diseases, Sex Dysfunction, Ophthalmology, Obesity, Pain mortality in the long term.
Rank*
Rank
US approaching
maturation in the
biotech industry
* Emerging Markets include China, India, Brazil, Russia, Mexico, Turkey and S. Korea
Source: IMS + Frost & Sullivan Estimates Source: Ernst & Young + Frost & Sullivan Estimates
The Rise in the Number of Microarray tools Tools to determine the down- Understanding the complexity of
Biological Drugs is Tools to identify genes or regulation of gene expression and biological systems
Expected to Boost the proteins that may correlate protein inhibition Improving the science of predicting
Contract Manufacturing with a disease process In silico tools for target the toxicology of emerging clinical
Market prioritisation candidates
Reliable data analyses to optimise
Biosimilars are the selectivity of drug candidate
increasingly being viewed Basic leads
Research Genomics, Proteomics, Combinatorial Chemistry
as a potential business Intelligent cell screening: Assay
opportunity for CMO’s automation and robotics to
improve efficiency and productivity
Two of the high growth Effective training and protocols for
areas for CMOs are Target Assay Lead Lead cell based assay technologies
Target
lyophilization and Identification Development HTS Discovery Optimisation Outsourcing high capacity cell
Validation
manufacturing of sterile culture to take advantage of cost
products efficiencies
60
Billions
ROW
6%
50 Asia Pacific
Latin America 15%
2% North America
43%
40
$50.2 Europe
30 34%
$34.9
20
2012
10
ROW
8%
0
Asia Pacific North America
2007 2012 Latin America 14% 40%
2%
Note:
North America - US and Canada
Europe
Latin America - Brazil and Mexico 36%
Europe - France, Germany, Italy, Russia Spain and UK
Asia Pacific - China, Japan, Korea India, Indonesia and Taiwan
ROW - Africa and Australia
Others: Neurology, Hearing Aids, Endoscopes, Durable Medical Equipment, Dialysis, Biomaterials & Haemostats, Disposable Surgical Supplies, Fitness
Equipment, Cosmetic & Aesthetics and Dental Equipment. The segment also includes some components of imaging and monitoring devices that fall into the
grey area between medical devices, medical imaging and patient monitoring.