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Pharmaceutical Industry Rapidly Expanding Partnerships With New Entrants in Health Care Space, Ernst & Young Finds
Date:2/14/2011

NEW YORK and LONDON, Feb. 15, 2011 /PRNewswire/ -- Pharmaceutical companies are dramatically increasing their investments in new and innovative offerings to meet the demands of a patient-empowered, data-driven, outcomes-focused future in health care. In the last year alone, pharmaceutical company investment in smart phone apps, educational websites, social media platforms, wireless devices and other programs increased 78%, as companies embrace a role that goes far beyond developing and manufacturing products.

While many of these initiatives involve collaborating in new ways with non-pharmaceutical companies, investments by these same non-pharma companies are outpacing those made by pharma companies, challenging industry members to either increase their level of investment or risk diminished relevance. These findings and other insights were released today in Progressions: Building Pharma 3.0, Ernst & Young's annual global pharmaceutical report.

The Progressions report provides a detailed update on the transformation currently underway in the pharmaceutical industry — one in which companies will need to shift from simply producing new medicines to demonstrating improvements in health outcomes and creating innovative new business models, an ecosystem that EY has entitled "Pharma 3.0." This evolution is being driven both by rapid advancements in health care technology and the coming to a head of health care's lack of sustainability globally.

The opportunities latent in these shifts are attracting a growing flood of non-traditional players to the health care space. The report estimates that non-pharma players have publicly committed at least US$20 billion in experiments with Pharma 3.0 related business models, an investment level several multiples larger than the allocations made by the pharmaceutical industry.

"New entrants to the health care industry are clearly committing much more to business model innovation th
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SOURCE Ernst & Young
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