HS&M - January/February 2019

Emerging technologies are creating a transformative opportunity for life sciences,
and scientific achievements are on a record pace.

Global Life Sciences Outlook
by Deloitte

important for accessing external expertise and technology. And technology companies, both large and small, are already poised to disrupt the industry.

ECONOMIC OVERVIEW

“Health life sciences” refers to the application of biology and technology to improve healthcare, and includes biopharmaceuticals, medical technology, genomics, diagnostics and digital health. The sector generates a wide range of products, including drugs, medical technology, diagnostics and digital tools.1

GROWTH TRENDS
PHARMACEUTICAL DRUGS

On the heels of a slow recovery,
global prescription drug sales are
forecast to grow at an impressive
annual compound rate of 6.5%
in the next five years. Worldwide
sales are expected to be US$1.06T
in 2022 (Figure 1) 2. This growth is
in contrast to the 2.2% compound-
The geopolitical climate is usher-
ing in a new era led by the passage
of tax reform in the United States
and Brexit in the United Kingdom.

In addition to embracing these changes, life sciences companies are looking for ways to meet the opportunities and challenges coming. Forward-thinking organizations will be:

n Building an adaptable organization for the future of work

n Building a culture of courage to help counter uncertainty

n Building data integrity, maximizing the value of data

n Building patient trust and centricity, across the journey of care

n Building a smart, cross-
functional regulatory approach
In order to grow, life sciences
companies will need to continue
to look for new partnerships and
operating models. Alliances and
partnerships will be particularly
ed annual growth rate (CAGR) in
2012-2016, but still under the 8.4%
CAGR before the global financial
crisis in 2004-20083. However, this
trajectory could be tempered by
pricing pressures and a potential
second patent cliff4.

Although not at previous levels, most research-based pharmaceutical companies are reporting an uptick in revenue and profits. Spending on prescription drugs is expected to increase in every market except Venezuela over the next few years.

Recovery in spending will be fueled by consolidation in generics markets and increased budgets for high-priced treatments, including orphan drugs. Some companies are still struggling with patent ex-piries, estimated to be a US$194B risk for sales in 20225.