Introduction

Pharmaceutical Industry and Healthcare

Sector: Challenges and Opportunities
Session-1

Mayank Aggarwal
mayank.aggarwal@ahduni.edu.in
Room Number – M-102, SAS Building
Agenda
• Introduction to course
• Expectation from Students
• Questions asked in this course
• Pharmaceutical Industry
• Healthcare Sector
• Challenges and Opportunities
• Covid and Its Impact
• What you will take away from this course
Course Objectives
• Develop Industry-specific knowledge in the Pharmaceutical and Healthcare
sector.
• Appreciate the need to manage conflict between social welfare and
Innovation and profits.
• Anticipate the challenges faced in entering the Healthcare sector.
• Cross-Functional application of knowledge acquired in economics, statistics,
ethics, and Management courses.
• Make the students aware of the potency of the Bio-Pharma innovation
engine and, at the same time, critical questions related to equity and
access.
How Do We Achieve These Objectives?
• Think about various healthcare context:- mental health, antibiotic
resistance, pandemic, heart disease, female health etc.
• Read articles and recent research on recent advances in healthcare.
• Learn frameworks and how to apply them given unique pharmaceutical
and healthcare context.
• Think in formal representation.
• Finally develop competency to abstract from cases and develop your
own frameworks and toolbox.
Logistics of Course
• Class Participation and Exercise- 10%
• Quiz-40%
• Project-20%
• Group Written assignment:- 10%
• Individual Assignment :- 20%
• Plagiarism and academic dishonesty will not be tolerated
What makes healthcare and pharmaceutical so unique?

• Semi public nature of good and services

• One of the most research intensive industry
• Credence good:- Even after getting the treatment you don’t know
whether service was worth it
• Physician as decision maker
• One of the biggest grand challenge
• Healthcare Ecosystem is complex with high number of
interdependencies
Why learn about Pharmaceutical and Healthcare
• To answer these questions
• Why healthcare infrastructure is limited?
• Why pharmaceutical industry has one of the highest R&D spending?
• How do you decide pricing in healthcare?
• What are the future innovation direction?
• Intersection of healthcare with digitisation?

• India Covid Experience

• Infrastructure shortage
• Slow innovation and dependent on foreign partners
• Loss of life and mobility
• Drug shortages and black marketing
 How Pandemic interact with Mental Health

Roy A, Singh AK, Mishra S, Chinnadurai A, Mitra A, Bakshi O. Mental health implications of COVID-19 pandemic and its response in India. Int J Soc Psychiatry. 2021;67(5):587-600.
Pharmaceutical Industry
• Pharmaceutical Industry is associated with R&D, manufacturing and sales of
drugs and biologicals
• Indian pharmaceutical industry is more than $25 billion in size with globally it
is around $400 billion.
• Relationships:- Alliances, joint ventures, M&A, supply chain, technology,
stakeholders etc.
• Strong R&D resource.
• It’s a semi public good with strong public welfare angle
• Drug price varies from single digit to in crores (Zolgensma).
Healthcare Sector
• Providing medical care to individuals and community.
• Physician is the decision maker.
• Public health vs private provider.
• Significant loss due to various healthcare issues
Major Riskfactors for DALY in India

Source: Dandona, L., Dandona, R., Kumar, G. A., Shukla, D. K., Paul, V. K., Balakrishnan, K., ... & Thakur, J. S. (2017). Nations within a nation: variations in epidemiological transition across the states of India,
1990–2016 in the Global Burden of Disease Study. The Lancet, 390(10111), 2437-2460.
Challenges
• Underdeveloped infrastructure.
• Negative perception of pharmaceutical firms.
• Stigma associated with various diseases.
• Strong public backlash to any failure.
• Wicked problems such as Antimicrobial resistance.
• Strong privacy concern
Opportunities
• India public healthcare spending is around 3% of GDP, in US healthcare is
18% of GDP
• Rapidly aging population, more demand for services
• Strong welfare focus. Potential to solve global challenges
• Strong role of technology
• Intellectual property protection
• Availability of data.
• Increasing insurance coverage
Innovation in Healthcare
• Significant scope of patient driven innovation
• Digital innovation to reduce healthcare cost
• Consumer focused innovations especially targeting stigmatized markets
• Personalized medicine, medical devices, diagnostic etc to fuel technology
driven innovations
• Key decision variables:-
• Financing
• Public policy
• Technology
• Physician support
• Ethical considerations
Healthcare Entrepreneurship
• Healthcare entrepreneurship looks at problem of both innovation and pricing
• One important criteria is societal impact
• Financial risk is high due to inherently high R&D cost and risk of failure
• Strong patents and first mover advantage is important
• Pricing should take into account risk of government actions
Medical Tourism
• Another big opportunity is in terms of medical tourism due to high
healthcare cost in other countries
• Identifying niche is important
• Build trust in healthcare services
• Trade in healthcare services is the one of the last frontier in international
trade
• Digital technologies can play a significant role
Source:- https://hcitexpert.com/2020/10/map-of-digitalhealth-apps-in-india-by-chinmay-athaley.html/#.YdwBOWhBzIU
Covid Impact
• Large number of excess deaths.
• Physician fatigue.
• Development of mRNA and other technologies.
• Strong mental health impact.
• Stock market impact (Moderna share rose more than 400%).
Covid Innovation
• Covid also lead to multiple innovations
• Increased penetration of digital health provides avenues
• Mass vaccination show how supply chains can be reconfigured to deal with
such challenges
• Solutions need to be adopted to local level
• Adopt existing solutions
• Rely on local ingenuity (AgVa portable ventilator)
• User driven innovation (PPE crisis)
• Focus on realtime data (Cowin Platform)
Data in Pharmaceutical and Healthcare
• Pharmaceutical Data
• Drug networks
• Drug sales and physician prescriptions (IQVIA)
• Pharma pipeline
• Pharmaceutical alliances
• Historical Data
• Future Projection
• Healthcare Data
• Infrastructure
• Number of physician
• Disease burden
• Insurance data
• Electronic Health Record
• Safety and Privacy
• Sensitive data
• All data is not available plus data quality issues
• Data may not be representative. Give wrong recommendation
• Context and scientific reasoning is essential
This Course Will Help You To
• Develop an understanding of strategies for high innovation industries
with significant welfare implications.
• Learn to apply insights from ethics, economics, management,
statistics to solve industry-specific problems.
• Developing an approach to find solutions to problems with multiple
stakeholders and sticky demand.
• Identify and find solutions to the pharmaceutical industry and
healthcare sector-specific challenges.
 One line take away
Develop a Structured, and scientific approach but remember
One size does not fit all
Be Involved, Be in Touch and Be Happy