Disruptive Innovation in Pharma: Past, Present, and Future
By Linda DiPersio, MSM, MSHC
In the book “The Innovator’s Prescription: A Disruptive Solution for Health Care,” Clay Christensen, who developed the theory of disruptive innovation, stated, “There are more than 9,000 billing codes for individual procedures and units of care. But there is not a single billing code… for helping patients stay well.” In the pharmaceutical industry, disruptive innovation improves health by generating ideas that create new drugs at the expense of existing ones. It is an alliance between technological advances and new business models that dramatically changes the performance of the industry. The progressive spectrum of disruptive innovation challenges include lessons from the past showing resistance to change, implications surfacing in the present which emerge from cautious analytics and trailblazing dynamics in the future aligned with patient centricity.
Past: Resistance to Change
Despite the remarkably positive success of antiseptic surgery with carbolic acid saving many lives during active combat in late 19th century Europe, Surgeon Dr. Samuel Gross from the United States said, “Little, if any faith, is placed by any enlightened or experienced surgeon on this side of the Atlantic in the so-called carbolic acid treatment of Professor Lister.” The medical community in the United States not only disapproved of the concept of germ theory that promoted the protection of patients against airborne microbes, and any drug associated with it, but also they fully rejected it – instead believing that miasma or bad air caused infection. After 30 years of successful usage in Europe, the jolting factor of antiseptic surgery acceptance in the United States is attributed to the almost assuredly avoidable death of President James Garfield. His non-life threatening gunshot wound from an assassination attempt was cared for by a team of doctors with germ-laden contact, including non-sterilized instruments, which lead to a major infection most likely being the cause of death.
As the above example shows, the advancement of pharmaceutical innovation efforts are most often prevented by established world views, opinions, customs, attitudes, societal values and complex psychological and emotional issues ingrained in the network of relationships that define individuals singly or collectively. In certain situations, innovation challenges are rejected directly because they are seen as threats to the means of support and character of many stakeholders, such as pharmaceutical companies, Federal regulatory institutions and the American Medical Association, that deploy an intangible but forceful influence on decision-making. Resistance to change in pharma emanates from industry incumbents whose jobs rely on sustaining the existing business model and political power. As Upton Sinclair said, “Never expect someone to understand change when their livelihood depends on not understanding it.”
Present: Cautious Analytics
Currently, pharma believes that marginal innovation is actually “safe” disruptive innovation because it is supported by confirmed targets, proven forms of action and/or established drug classes. In reality, it is extremely risky. Marginal pharmaceutical compounds have a high risk of not achieving end results, not being accepted by regulators and/or not performing up to the standards of existing less costly therapeutics and fail commercially. Recent studies with marginal drugs show a 50% failure rate due to a lack of efficacy or safety.
Safer trials, which are designed to add evidence-based support of the versatility of top drugs, take away the amount of funds from innovations and discovering new cures. There are no pre-competitive consortiums to divide the challenges and costs of developing new knowledge about disease causation. Today, innovation is distributed over a group of partners with universities conducting the riskier early translational research and pharma investing in late development with perceived low risk. Beginning as low risk, low returns and low R&D, cautious analytics eventually equate to bad risk with ill-fated consequences.
Future: Multi-Dimensional Patient Centricity
In the future, the drug lifecycle needs to incorporate many facets of patient centricity, including the use of new technologies such as gene- and proteomics, gene therapy, nanotechnology, and Big Data driven predictive analytics. Precision medicine will identify exact patient needs and tailor molecular profiles to create the most beneficial treatment plans for patients on an individual level. New social media tools will allow patients to share information and participate in collaborative discussions with regulators and pharma.
If pharma practices the five skills of questioning, observing, networking, experimenting, and associating that are outlined in the book “The Innovator’s DNA” authored by Gregersen, Dyer, and Christensen, disruptive innovation will be constructively delivered, empowering patients, and effecting positive change through physicians who will proactively treat and potentially prevent illnesses before they become a major source of concern. Creativity that changes behavior will be framed by:
- Asking controversial questions that confront existing knowledge of the industry;
- Thoroughly examining behaviors to identify new ways of doing things;
- Encountering people with fundamentally dissimilar ideas and perspectives;
- Building interactive experiences that trigger non-traditional responses to discover what insights emerge; and
- Connecting the dots with questions, issues or ideas from unrelated fields.
In summary, the past and present challenges mapped out on the spectrum provide valuable information that will shape future disruptive innovation in a beneficial way. Lessons learned from the past indicate that attitudes impacted the resistance to effective existing pharmaceuticals. Presently, with pharma’s perception of “safe risks,” engaging in cautious analytics eventually results in bad risks. In the future, leading the way with a multi-dimensional, patient-centric approach to the drug pipeline will allow for increased profits and improved health outcomes. As Clayton Christensen said, “Disruptive innovation is a positive force.”
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