Pharmaceutical Industry
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1. Accelerated R&D processes - use of computerised testing techniques, use of discovery/prior testing data banks to avoid unnecessary tests which are already a matter of record, parallel rather than sequential testing etc.
2. Rigorously targeted R&D with constant ongoing review for potential 'plug' pulling or accelerated investment if things look promising.
3. Streamlining of overheads - centralising administrative processes (in country, cross border, global), outsourcing where appropriate (IT, payroll, accounting processes, fleet management, cafeteria etc.), better systems, enhanced use of technology, streamlined processes etc.
4. Strategic mergers/take-overs/divestiture of non-core businesses in order to leverage R&D, eliminate duplicate R&D, leverage differing geographic sales and marketing strengths and streamline administrative support functions. This needs to be carefully handled since the acquisition of a slower growing/lower profit ratio organisation may well be dilutive to the parent growth and profit profile and further disenchant the investment community. Operating synergies need to be able to overcome any such dilution within a couple of years or so in order to protect the investment profile.
5. CEOs are upselling the industry at senior governmental and media levels all over the world and preaching the 'gospel' of the commitment to better healthcare through appropriate pricing and profit profiles and R&D. The 'gospel' also includes unequivocal warnings about the downside potential of enforced reduced prices and profit controls - slower development of solutions for therapeutic needs and lower investment into 'offending' countries. Arguments include inter alia:
- New and better drugs save lives and enhance the quality of life for countless others.
- Drugs form only about 10% of the healthcare budget and a good drug can accelerate the healing process and, in the case of hospitalisation, free up hospital beds earlier therefore benefiting both current and future patients and reducing overall treatment costs.
- Competition in R&D (as in most things) yields better results than a non-competitive pooling arrangement.
- The pharma industry contributes hugely to the host economy through corporation tax, employment, local peripheral economies etc. For example, it is estimated that the 5000 Pfizer employees and 2000 pensioners (private scheme) in the UK support a family and associated business community environment of between 30 and 40,000. The company is a huge net tax contributor to the nation, is a major exporter and generates large royalty incomes for the UK from it's R&D discovery programmes.
6. The industry leaders are in increasing contact with underdeveloped countries to provide healthcare education and free drug programmes for endemic third world diseases such as insect/bad water related eye disorders and peripheral fungal HIV symptoms.
7. Forging relationships with small, focussed pure research laboratories and universities i.e.'we will pay for your research for a given period and in return have the right to market any commercially viable outcomes and share the profits with you'. This is more economical that starting all over again and covering duplicate ground.
