Thursday, 29 September 2016

Takeaways from Health 2.0

As I mentioned in a previous post, I presented at this year's Health 2.0. I also stayed for a number of sessions on digital and innovation. As a relative newcomer to this industry it was enlightening to hear the common themes coming through in presentations from the big pharma companies, so I thought I'd share my main takeaways.

The strategic direction of the industry can seemingly be summed up in the phrase "beyond the pill", which is a composite of two big ideas:

  1. Digital-only treatments that address the root cause of health problems, which are often bio-psycho-social. Lifestyle, not disease is killing people, so it may be possible to create highly addictive, game-like experiences that change lifestyles and therefore beat the statistics.
  2. Treatment ecosystems that reflect the fact that people's problems are often blends of ailments that cannot be effectively treated by a single drug provider or physician. Doing this for real suggests some kind of aggregator that blends patient data on symptoms and ability to pay with combinations of treatments... kind of like a terrifying Skyscanner for treatment
This world suggests a range of potential business models:
  • Faster, radically cheaper drug development pipelines with (basic) digital underneath them, rather than the reams of paperwork and endless loops that underpin today's processes. This would be necessary because monopolies would be removed by (2) - the ecosystem would reveal other options than a wonder-drug and thus potentially remove customers who would otherwise have used the treatment unnecessarily
  • Selling outcomes, which could be as sophisticated (terrifying) as paying per year of extra life or for quality of life. This is the ultimate destination of a pivot to patient-centricity, which the industry appears obsessed with. I personally think that no one on the stage really understood the difference between a product business that thinks about customer needs and an actual patient-centric business, which is the route into treatment for patients that love them... I call that a 'doctor', but probably wrong...
  • Selling enabling data and tools into the ecosystem to cater for new requirements within the packages of care that are being assembled. This portfolio strategy is certainly interesting. I felt that pharma people lobbed 'monetising data' into the conversation because it was trendy, rather than really understanding how to do it... but a few of the startups (Tonic Health and HGE, take a bow) demonstrated how! That must be why the former are the sink of value in the industry
Operating model was also discussed in reasonable detail; generally accompanied by sighs and hand-wringing. I do understand why it's hard for pharma to do digital (cadence!) but I also think that a research-led industry that depends on accurate, objective data is well-equipped to adapt to an experimentation-based business model. If they aren't then no one is!

The main thrust on operating model was whether to make innovation a business unit (all of the big guys had done this) and how to supplement it with incubators and venture capital investments. My view is that the latter is over-blown in pharma. These are organisations that have always acquired new ideas. Doing the same in digital is just an extension of med-tech, rather than the use of carnivorous acquisition to change the make-up of the core business. No one could point to a successful acquisition, either... Just sayin'...

Anyhow, enough negativity. I enjoyed the conference. Not something I can often say about these things, perhaps because I've heard the same thing at tech' conferences for 10 years. Or something.

Monday, 26 September 2016

Lean Startup in Pharma

I was lucky enough to be asked to present at the Health 2.0 conference in Santa Clara this week on the topic of digital innovation in the pharma industry. This might surprise some of you (given that three years ago I'd hardly every worked outside tech and media), but we've actually been doing some cool projects in the industry. 

I thought you might be interested in the topic since pharma is yet another industry impacted by the Digital Economy, but one with some idiosyncrasies created by the hellishly long and expensive product development process and the role of regulators. If they're going to change from pills to outcomes some fairly major things will have to change and I like to think we're helping a little.

As ever, I talked a little about the reasons why digital innovation fails:
  • Failure to validate demand
  • Failure to iterate
  • Failure to track and measure (particularly since the root cause of positive outcomes is hard to figure out)
  • Failure to structure effectively
The particular challenges of doing this in the pharma industry are in red below. Resolutions learned from our project shown in grey.

Lengthy product cycles caused by the typical decade-long drug development process are a barrier because consumer-centric digital experiences are far faster twitch. The practical reality is that digital experiences are features of an overall product system but are distinctly different to drugs themselves. You can't lump them together and expect either to succeed. It's the classic need to introduce a second cadence into the organisation to cope with digital innovation.

The nature of MVP is important to consider as well. When we started off our journey with Snakebite 911 we were presented with a 10 page list of features that should be in the MVP. It's credit to our client that they were willing to radically reduce that down to the bare minimum required to prove the concept. Many don't work that way - they produce 'beta' products with way too many features, which are counterproductive as they muddy the purity of the experiments needed in lean startup.

Decision making is another fundamental issue. Too many boards to collaboratively ruin progress is just not needed in proving digital. Cutting through that with structure is vital: we established working practices to devolve decision making down to a couple of empowered Managers.

Regulation and legislation mean that pharmas are forced to maintain significant distance from patients and therefore can't do typically validated learning. That's a great excuse, but practically there are stakeholders that are more important from a commercial standpoint. Physicians and first responders in our case actually had a huge impact on the outcomes that people got from their treatment. Engaging with them is very much easier (being careful not to advocate products, which is easy if you're a third party and don't understand it!).

Heavy penalties for mistakes are part and parcel of medicine. I understand the need to prevent process-based errors, but there's a difference between that and having a bad product idea. Pharmacos are paranoid in any case and the businesses are generally run by regulation and compliance as much as sales and marketing. We got round this in two ways:
  1. By only doing the absolute minimum in the digital experiences to get a result, rather than complex feature overload that would be hard to clear
  2. By engaging very early with the regulatory teams, listening to them as equals and making them part of the core team. Therefore there were no surprises!
So, early days for me in pharma, but some interesting lessons that have applicability to other industries (e.g. banking) that are also heavily regulated.

Sunday, 25 September 2016

Framework for the structure of digital teams

A short post from me to share a simple framework I developed last week to explain the options an organisation has in implementing a digital team. It uses two axes:
  • Degree of coupling to the traditional organisation, which refers to how well integrated the digital team is into the hierarchy; and
  • Way of working, which defines the culture of the team, from traditional to digital native
I found it quite useful to determine the leadership team's level of ambition. Hope it's useful!