Inovations in life science industry drive increasing improvements in health care
Managing pathways to convergence in the life sciences industry
PRAGUE, 15 May 2007 — In the life sciences industry, convergence is defined as the integration of two or more core technologies (diagnostics, devices, and/or drugs) to create an improved health care product. Innovations through convergence are resulting in earlier diagnosis, more patient-centered care, and safer, more effective treatment for many conditions, according to a research — Managing pathways to convergence in the life sciences industry — by the international consultancy firm Deloitte.
Some diseases can now be detected at very early stages with diagnostic technologies that involve the use of drugs. Device implants can provide patient monitoring systems that offer less invasive, less painful, and more convenient diagnostic and monitoring methods than traditional methods. The convergence is now leading to innovative health care solutions and new opportunities for both business growth and product differentiation.
“As companies pursue new convergent opportunities, alliance networks are likely to evolve in scale and scope, further changing the landscape of the life sciences industry.”
— Jaroslav Škvrna, Partner, Deloitte Czech Republic
“ Scientific advances, shifts in consumer demand, as well as market pressure and opportunities are all driving the trend toward convergence in the life sciences industry and between diagnostic and instrumentation companies,” says Jaroslav Škvrna, Partner in the Tax & Legal Department of Deloitte.
Blood glucose monitors combined with implanted insulin pumps are the most visible example of this type of convergence. By integrating convenient, round-the-clock monitoring with a timely, controlled release of insulin, this convergent solution provides diabetes patients with a less invasive and more effective treatment alternative.
Scientific advances, the sequencing of the human genome and advances in areas such as genomics, proteomics, stem cell research, and nanotechnology have opened new diagnostic and therapeutic avenues. The discovery and development of molecular markers continues to improve target identification, genetic-risk profiling, test accuracy, disease detection as well as monitoring, treatment selection, implant device technologies, and delivering drugs in a targeted, controlled manner.
As the Baby Boom Generation grows older, the shift toward an older, more engaged patient (consumer) base is prompting greater focus on and demand for improvements in the diagnosis and treatment of chronic conditions. Product pipeline shortages, increasing competition from cheaper generic drugs and biologic alternatives are pressuring pharmaceutical companies to create new growth opportunities.
There are two major types of technological uncertainty involved in convergence: component uncertainty and integration uncertainty. Component uncertainty refers to whether key components are already available for a convergent solution - blood glucose monitors with insulin pumps, both components — the monitor and the insulin — were well-known. In contrast, targeted drug therapies associated with diagnostic tests for various cancers are still in their infancy. Integration uncertainty, i.e. whether necessary interfaces exist to integrate the components into an effective combination product.
To realize the promise and value of convergence, firms will have to move beyond traditional industry boundaries, resolve technological uncertainties, and learn to operate within a network of companies that have substantively different business models, product life cycles, organizational structures, and corporate cultures. If life sciences firms can overcome these challenges, convergence seems certain to become a significant driver of innovation, growth, and improvement in health care delivery and outcomes.
Since most convergent technologies are in various stages of incubation and development, it is premature to estimate the impact convergence will have on industry growth and health care costs. “ As companies pursue new convergent opportunities, alliance networks are likely to evolve in scale and scope, further changing the landscape of the life sciences industry,” adds Jaroslav Škvrna.
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