Following a tumultuous period for the Life Sciences industry, Coalesce Management Consulting looks ahead to a year of great change and opportunity across the sector. Here’s our 2024 outlook for the pharmaceutical, medical device and nutrition sectors.
Our global technical consultants specialist in everything from project and construction management, to automation engineering, commissioning, qualification and validation across large pharmaceutical, medical device, biotech, R&D and manufacturing firms, which gives us excellent insights into the growth areas and opportunities within the life science market.
Understandably, we see many organisations still risk averse and cautious, given the continued instability of the global economic climate. However, others are making bold and innovative plans to revitalise their operating models to take full advantage of data-driven insights so that they can satisfy stakeholders, better serve patients and gain increased control of their markets.
Read on for some of what we’ve learnt about the biggest growth opportunities and the key challenges the life sciences sector faces.
Life Sciences opportunities in 2024
The growth of the healthcare manufacturing sector
It’s more than 20 years since Singapore set out its mission to become a global biotech hub, when the government launched the National Biomedical Science Strategy in hopes of creating a “fourth pillar” of the economy.
Two decades and billions of dollars of investment later, the seeds planted from the establishment of Biopolis in 2003, many finally be bearing fruit.
A series of promising developments that ultimately didn’t amount to anything have prevented Singapore from becoming the world-leading biomedical location that was promised – but change takes time and small successes drive investor interest for major opportunities. From 2012 to 2022 the number of Singapore-based biotechs increased from seven to 52; with the government’s Research, Innovation and Enterprise 2025 scheme set to inject $25 billion SGD in funding by 2025.
A significant success story took place in May last year with the opening of the US$130 million (175 million SGD) Thermo Fisher Scientific Fill-Finish Facility in Joo Koon Circle in the Jurong district, which will develop and manufacture vaccines and biologics – the first of five vaccine production plants that have been planned by pharmaceutical companies since the Covid pandemic.
With the potential to produce more than a billion vaccine doses annually, these combined plants will be massive for Singapore’s biomedical market.
The major players are taking notice, with Johnson and Johnson signing a “first of its kind” pact with the Singapore government last September, to invest and develop early-stage companies in medicines, medical technologies and healthcare solutions, through a series of local programs and global partnerships.
Operating as JLABS – J&Js incubator arm – the company will be using their extensive resources to help selected startups execute their plans and pitch for necessary funding – with many anticipating growth beyond the Singapore market.
So in 2024 we see this potential opening up and Singapore’s life science manufacturing sector finally taking shape in the way that was promised back in 2000. This is the perfect time to be operating in the life sciences sector, which is why we’re focusing on bringing on more experts and more growth within the area.
We’re providing our services to more life sciences businesses in Singapore than ever, and ensuring we’ve got the best manufacturing experts available on our bench.
The exponential growth of AI technologies
The capability and takeup of AI driven systems has grown exponentially throughout 2023. This is reflected across all of the sectors we serve, from aerospace and automotive through to process manufacturing. This is no more apparent than in the life sciences sector.
There’s been a real buzz around the subject of generative AI in recent months. Most of the larger clients we work with recognise its revolutionary potential. They’re looking for ways to embrace the technologies and position themselves as employers of choice to attract the top talent.
Generative AI, also referred to as GenAI, is already sharing a glimpse of its transformative potential for the sector. It allows you to input prompts to generate new content and can already do this with images, videos, code, sounds and more. Appealingly, it “learns” as it operates and will continue to be trained to handle scientific publications and documents that already exist online.
According to a report by Definitive Healthcare, the global AI in life sciences market is projected to reach $7.09 billion by 2028, growing at a compound annual growth rate (CAGR) of 25.23%. The report tells us that half of the 50 largest pharmaceutical companies have entered into partnership or licensing agreements with AI companies.
We’re excited about the potential for AI to create more effective drugs; to make it easier to identify when patients are ready for treatment; to enable robot-assisted surgeries; to develop the technology behind digital twins; and to ultimately improve upon patient outcomes. We’re also expecting to see more AI applications used to diagnose disease earlier, to support clinical trials and to mitigate risk. All of this while cutting costs!
The sky seems to be the limit when it comes to the opportunities that AI offers the life sciences sector. Here are some of the areas that we are particularly enthusiastic to support:
More precise, precision medicine!
The field of precision medicine is set to benefit massively from AI. This is perhaps primarily down to the revolutionary developments in the identification of biomarkers. These are based on a patient’s genetic profile, the lifestyle they lead or the environment they inhabit. It’s envisaged that these patient biomarkers, analysed by AI algorithms, will help health professionals to determine and deliver tailored treatment plans. Treatments that are more effective and less dangerous, while optimising healthcare efficiencies.
Some of these applications are already up and running. Take for example the work of IBM Watson, a data analytics processor with natural language processing and machine learning. The company has already developed an AI-powered platform for processing clinical trial data and to delve into the details of existing research papers and scientific publications. They suggest that this technology is already helping to identify RNA-binding proteins for amyotrophic lateral sclerosis (ALS) and Alzheimer's disease.
Unlocking the power of trapped data
The healthcare industry generates a huge amount of data every day, all around the world. Much of this potentially powerful information never sees the light of day. It becomes hidden and unappreciated, trapped within the confines of an organisation’s systems.
As generative AI evolves its models and algorithms will continue to be trained to better handle vast swathes of data. It will be tasked to tackle large unlabeled data sets and is already beginning to predict outcomes in the same ways humans might on their own…only with far more intelligence and efficiency than the average human!
Through 2024 we expect to see big leaps in the development of data-driven automations and ‘structured data.’ A key benefit of structured data over document-driven workflows is that it offers the tools to release trapped information for the benefit of everything from pharmaceutical trials to efficacy and safety studies. Coupling the emergence of structured data models with the growth of DTx technologies, we see a bright and more robust, patient-centric future for many areas of healthcare.
AI-driven scans and diagnostics
It’s becoming clear that the advancement of AI will soon revolutionise the field of medical diagnostics by making scans faster, more efficient and more accurate.
Imagine if you will, highly accurate AI algorithms trained on large datasets of medical images. This will surely help to assist oncologists and radiologists to identify abnormalities detected through X-rays, CT and MRI scans to provide better, faster diagnoses.
Bold innovation for a challenging world
Most of the life sciences company leaders that we talk to on a daily basis list the development of innovative new therapies and products as a top priority this year.
For example, some clients are continuing to recognise and explore the groundbreaking potential for digital therapeutics (DTx). Primarily, this is because they see the opportunity for increased revenue, following the investment of competitors in digital health technology companies and partnerships.
Digital therapeutics offer increased confidence for patients at different stages of their treatment journey. They promise a positive impact on existing product efficacy, treatment monitoring - including patient adherence to a plan - or even patient coaching.
It’s hoped that this huge growth market will help both patients and healthcare providers alike. Companies are excited about the potential of digital therapeutics to drive down patient waiting times or reduce readmission rates for patients with serious heart defects, for example.
Direct-to-consumer model redirection
We’ve been observing a demonstrable shift towards direct-to-consumer (DTC) healthcare models through 2023 and this looks set to continue.
The pandemic years fostered a sense of normality around virtual appointments with doctors and therapists. Instead of traipsing to physical locations, many patients now appreciate the opportunity to speak with a healthcare professional from the comfort of their own homes. This has led to a number of start-ups popping up to offer more of this type of DTC service, that only a few years ago, was almost unheard of.
Many of our clients recognise the benefits of convenience that come with DTC models, but they also talk to us about the potential for cutting costs, streamlining processes and reducing waiting times.
Healthcare e-commerce continues to grow
The technological advances of 2023 and the growth of online pharmaceutical vending is leading to much investment in healthcare e-commerce.
The use of e-commerce to offer medical services is becoming increasingly common. More and more people are now less inclined to make a physical visit to a pharmacy and more likely to purchase medical devices and drugs online. This means that care providers, drug sellers or manufacturers of medical devices are finding more ways to sell their products on the internet.
From a B2B perspective, the improved ecommerce options allow for smoother interactions between vendors, clinics or private hospitals and surgeries. This can help with maximising revenue with more opportunities to sell goods and services while reducing treatment costs.
From the patient or customer’s perspective - they can choose from a broader range of products, to buy at discounted rates - or benefit from bulk discounts. They can help to shape the future of healthcare ecommerce by submitting survey responses and they can choose suppliers that can match their turnaround requirements.
Life sciences challenges in 2024
What would John Connor say?!
Wider conversations around the danger of AI becoming too powerful, overthrowing and dominating the human race aside! Within life sciences, thankfully there’s some slightly less unnerving concerns to consider.
As we outlined above, 2023 was a massive year for the development of AI technologies. Many are confident and enthusiastic but some life sciences professionals we speak to have flagged several concerns.
At CMC we talk to decision makers from organisations of all sizes and types. Some of the more established businesses we work with are already introducing AI technologies, while smaller start-ups are typically less bold. Instead, they’re choosing to observe how the sector-changing innovations are rolled out, to observe and learn from the mistakes of others and then introduce their own systems within the next two to five years.
Despite all of the positivity our clients are expressing for AI applications, some of them have a limited understanding of the implications and capabilities of such advanced technology. To get past this and incorporate them safely, securely and ethically, they’ll need to invest in focused learning and bring in people who can bring them up to speed.
Some hiring managers are not as gung-ho as the rest. Some reservations cited include concerns about cybersecurity risks and the size of the task involved in connecting data points, while creating the right infrastructure to support the technologies.
We hear concerns that the rapid rate of growth is speeding ahead of an essential regulatory framework to guide its proper use within healthcare scenarios. We hope this becomes a priority for legislators in the coming months to safeguard data and protect patients against improper use.
Drug pricing problems
We’re told that many of the big players in the pharmaceutical sector, including Pfizer, Sanofi, and Takeda Pharmaceutical are raising prices on over 500 drugs this month following changes in drug pricing regulations.
Drugmakers are reacting in preparation for the release of a US Government publication of significantly discounted prices for 10 high-cost drugs later in the year. The Inflation Reduction Act (IRA) will give the government’s Medicare health program the power to directly negotiate drug prices from 2026,
With inflation rates unstable and the soaring costs of manufacturing drugs, some pharmaceutical companies, the world over, are taking this preemptive response in an attempt to proactively navigate these impending changes.
We are told that drugmakers are largely adhering to the industry practice of keeping price increases at 10% or below, but this will still clearly impact upon the delicate relationship between reaching financial objectives and addressing public and regulatory expectations.
Supply chain shake-ups
While the earth-shaking impacts of the Covid-19 pandemic have lessened through 2023, there’s no denying it: we’re still living in an unstable world. Ongoing conflicts and sabre rattling over other contested geographies, plus the concerns about how future pandemics could impact upon global economies, markets, and customers are key areas of concern.
Many of the biopharma executives we speak to echo this unease. Some are seeking to lessen any impact by investing in the AI and digital technologies we have described earlier in this piece. We work with biopharma supply chain leaders who are transforming their supply chains through digitalisation, and others that are less proactive.
It’s been great to witness so many life sciences companies making good on their commitment to protecting the planet and slash their environmental footprint in recent years, taking tangible actions, not just making empty promises. However, the impact of the pandemic years on global supply chains has hampered some of this progress.
Supply chain activities required to manufacture and transport drugs impacts upon the environment. When raw ingredients and materials become scarce then some companies feel forced to seek out other supply chain routes that may not be as environmentally sustainable and generate more pollution.
The economy and inflation
While interest rates continue to move in an upwards trajectory this has a profound impact upon life science businesses, creating a lack of confidence to pursue their more ambitious growth plans.
Through 2023 it appeared that inflation across many countries had stabilised, but some of our clients and consultants remain unconvinced. As such, the threat of soaring inflationary costs is influencing business strategies for 2024 - for some in a major way, for others, it’s mildly precautionary.
Harnessing the potential of new technologies is one way that companies will stave off the worst effects of inflation. But we deem those organisations that choose to focus strategically on the projects that offer only the most return on investment are the ones that will prosper despite the economic conditions.
Health equity considerations
Many of our clients across biopharma and medtech are planning to address health equity within their strategies for 2024. To attract more people of all races, ages, ethnicities and genders to take part in more clinical trials. In doing so drug makers will better understand whether their products are safe and effective for all different types of people.
We have seen this increased focus in the aftermath of the COVID-19 pandemic. This has included conducting clinical trials in areas that are more accessible to underserved communities.
Delivering Life Science Expertise in 2024
An adaptive business model to mirror yours
As you have been adapting your business model through 2020 to 2023…so have we! To overcome the global hurdles and help companies to develop more agile and strategic approaches,
Our consultants specialise in different industries within life sciences, meaning they truly understand the complexities of your project. They go further in identifying gaps in your team to advise you on the best solution to meet your future goals.
We work proactively with the leading life science experts, nurturing relationships and investing time in understanding a person’s technical know-how, leadership capability and softer skills, so that when you need support, we can deploy a consultant who ticks all the boxes.
We offer individuals, or whole teams
We bring many years of working knowledge of how to overcome challenges in market availability. This enables us to present you with rich shortlists featuring multiple consultant profiles with diverse experiences. We can supply individuals - or whole project teams. When we say we offer a truly bespoke service that can flex to your requirements…we mean it!
Get in touch today and we can talk you through how we can best support your life sciences project and solve your people-shaped business pressures. But don’t just take our word for it! We walk our talk and will happily provide you with celebratory testimonial evidence direct from companies in your industry.
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