What Does Sustainability Really Look Like in Pharma?
The concept of sustainability often emphasizes environmental considerations. However, in the pharmaceutical industry, the most material element lies within the “S†of ESG framework —Social, particularly in ensuring access to medicine. ESG (Environmental, Social, and Governance), serves as a framework for companies to align their operations with sustainable and ethical practices. In this context, materiality assessments allow pharmaceutical companies to identify their most critical ESG priorities, consistently bringing patient health, safety, and equitable access to medicines to the forefront (A, B).
Challenging Traditional Business Models in Pharma
The pharmaceutical industry is largely concentrated in developed markets, with North America and Europe leading in global sales. Together, they account for 76% of worldwide pharmaceutical revenue, according to the European Federation of Pharmaceutical Industries and Associations (C). This dominance stems from regions populated by just around one billion people, a stark contrast to the untapped potential across the remaining global population of over 7 billion. Emerging markets present a significant opportunity for growth and innovation, especially in healthcare.
Traditionally, pharmaceutical companies have focused on developed markets, employing a go-to-market strategy centered around large-scale marketing, expansive sales teams, and securing reimbursement from insurers and governments. Effective in well-established regions, this model ?????often struggles to adapt to the diverse and often challenging healthcare landscapes in developing areas, where affordability and infrastructure remain barriers.
Given these realities, there is a strategic imperative for the pharmaceutical industry to reimagine its approach. This shift toward more flexible, inclusive models could open opportunities in underserved regions, addressing healthcare needs for billions while ensuring long-term growth. Embracing this direction is not only a business advantage but also a moral imperative to contribute to global healthcare equity.
Reimagining Traditional Pharma Models
Over the past few decades, there have been notable innovations in healthcare business models tailored to the unique needs of developing countries. Some pioneering companies have successfully broken away from traditional methods, introducing impactful approaches that make healthcare more accessible and affordable.
Novartis' Healthy Family Programs, particularly Arogya Parivar ("Healthy Families"), launched in 2007, exemplify a sustainable model addressing healthcare access in underserved rural areas. The program integrates health education, affordable medicines, and capacity building into a socio-commercial framework, creating lasting impact. Key features of such a program can serve as a blueprint for application in other contexts or geographies. Here are some of these elements (D, E):
- Awareness & Health Education: Promotes health literacy through local health educators, fostering health-seeking behaviors.
- Affordable Medicines: Offers a tailored portfolio of low-cost medicines for rural communities.
- Capacity Building: Trains healthcare workers and professionals (HCPs) to strengthen local healthcare systems.
- Efficient Distribution: Utilizes local distributors and micro-entrepreneurs for last-mile delivery.
Through its innovative initiatives, the program has made a remarkable impact by reaching 22,000 villages across 15 Indian states, connecting rural communities to essential healthcare services. With an extensive network, it has engaged 44,000 doctors dedicated to serving rural India, ultimately transforming the lives of more than 50 million rural Indians.
This model highlights how innovative, community-focused approaches can balance social and commercial goals, ensuring equitable healthcare access. For the pharmaceutical industry, such initiatives demonstrate that addressing healthcare accessibility is both a critical responsibility and a strategic opportunity to fulfill its mission of improving global health.
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Executive Education: Empowering Leaders to Challenge the Status Quo
One of the most effective ways to shape the future of the pharmaceutical industry is through targeted education, especially at the senior executive level and by engaging emerging talent. Innovation often takes root when leaders—and early-career professionals eager to make an impact—are motivated to challenge the status quo and explore fresh operational strategies.
In our recent "Global Pharma Industry" (F) executive education program, participants were tasked with developing innovative business models tailored to the unique needs of specific African countries. Each business case aimed to achieve financial sustainability within 3-5 years, demonstrating how traditional approaches can be transformed through strategic exercises. For instance, one group created a model to address hypertension in Ethiopia, while another focused on enhancing maternity care in Angola. Other projects included launching an affordable diabetes treatment in Egypt and creating child-friendly medication options for Nigeria. These case studies underscored the importance of adaptability, local partnerships, and culturally responsive solutions to ensure long-term impact.
The pharmaceutical industry needs leaders who are prepared to test new models, build strategic collaborations, and drive innovation. With the industry’s vast expertise and fresh perspectives from emerging talent, there is tremendous potential to develop scalable, impactful strategies that enhance healthcare access worldwide.
?A Call to Action: Redefining Pharma's Role in Global Healthcare
In conclusion, while the traditional pharmaceutical model has achieved significant successes, it no longer fully addresses the complexities of global healthcare challenges. There is immense potential for impact, particularly in emerging markets, where unmet medical needs are most pronounced. By embracing innovative business models, fostering strategic partnerships, and adopting a mindset that prioritizes accessibility, the industry can play a pivotal role in bridging the healthcare gap.
Access to medicines is not just a challenge - it is one of the most material imperatives in the pharmaceutical industry. The future of pharma must focus not only on developing life-saving medicines but also on ensuring equitable access to those treatments for patients across all geographies and socio-economic levels. This is how we, as an industry, can truly embody the mission of advancing health for all. Let’s walk the talk and make universal healthcare access a reality.
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Clinical Research I Leadership I Management I Strategy
3 个月Absolutely, Daniel Guedelha, you make an excellent point! In today’s world, the ‘S’ for Social in the ESG framework is incredibly significant, particularly in ensuring underserved patients have access to essential medicines. Initiatives like #ArogyaParivar and the unwavering commitment of #Novartis and its teams over the past 17 years are truly commendable. These efforts are a testament to how businesses can create a lasting social impact while driving meaningful change.
Procurement and Supply Chain Manager @ THE FORCE CT GmbH | Consultant ? Strategic Supply Chain ? Lean Six Sigma Black Belt
3 个月From my experience in supply chain optimization, I see a significant opportunity for pharma to enhance distribution strategies in underserved regions, leveraging local networks to strengthen last-mile delivery. Strategic partnerships and tailored approaches are crucial for scaling impact and aligning with the ESG priorities discussed. It’s time for the industry to prioritize accessibility as a business and moral imperative, transforming global healthcare supply chains for equity.