What’s Up, Doc? An In-Depth Look At Harnessing Process Management In The Pharmaceutical Industry

Written by Tecwyn Hill | 5 min read
Published on: September 25th 2018 - Last modified: November 13th, 2020
process management in the pharmaceutical industry - filling test tubes in a laboratory

Globalization. Consolidation. Regulation. To nail these challenges, the pharmaceutical industry must continuously evolve. But stats show it now costs almost $2 billion to bring a drug to market, while return from research and development (R&D) is at a low of 3.2%. With such burdens, there is substantial scope for process management in the pharmaceutical industry to transform value-driven frameworks to better understand cross-process and cross-organizational issues. For success, the industry must squeeze the most out of all core and quality-centric processes, and incorporate highly efficient and integrated business models.

The Failing Health Of The Pharmaceutical Industry

The regulatory and monetary grip pinching the pharmaceutical industry

We have entered an era where core business processes in the pharmaceutical industry need to be reassessed and redesigned to better align with the changing economic environment. This pressure is caused by several issues including customers and stakeholders demanding more innovative pharmaceutical products at more competitive prices, while the cost of doing business is rising, potentially jeopardizing pharma’s aggressive revenue growth targets.

Of course, issues snowball further when we consider that this industry develops, produces, and markets drugs, as well as generic or brand medicines and medical devices. It is no surprise pharmaceutical companies, and biopharma are governed by a variety of laws and regulations, covering the patenting, testing, safety, efficiency, and marketing of medications.

With this understandably tight regulatory grip exerted by controling bodies such as the American FDA and HIPAA, and the European EMA; profits and ROI are being squeezed, and the industry is suffering from ill health. According to the Deloitte study, Measuring The Return From Pharmaceutical Innovation 2017:

  • It now costs companies almost $2bn to bring a drug to market
  • R&D returns have declined to 3.2%, down from 10.1% in 2010
  • Projected peak sales per asset more than halved between 2010 and 2016
  • This year’s uptick in costs and sales per asset is due to the drop in the number of assets in late-stage pipelines–from 189 in 2016 down to 159 in 2017

Just What The Doctor Ordered

The substantial benefits of process management in the pharmaceutical industry

However, even with this gloomy prognosis, there is scope for Business Process Management (BPM) to impact the pharmaceutical industry positively. Adopting a flexible modeling solution which can be individually tailored to each organization would be a strong start.

After all, pharma companies must incorporate highly efficient, quality-centric processes, while a pharmaceutical supply chain has to be scalable and agile enough to accommodate changing scenarios and partners across the globe.

But the real payoff is BPM's potential to help companies define business processes and unify information systems. This helps to break down barriers between organizational and geographic divisions, and improve collaboration and innovation.

For example: The process for developing medication labeling documents involves collaboration across many stakeholders and approvals that have to be obtained from regulators worldwide.

The impact of process automation in the pharma industry

Another benefit of implementing process management in the pharmaceutical industry is to identify segments of a business process that could be automated. Often, these are employee choke points where information is taken manually. In these cases, the system can provide email notifications and reminders, in combination with web-based forms, to prompt workers to perform tasks and keep things moving.

This layer of workflow automation also provides visibility across processes that otherwise would occur out of sight of the eagle eye of corporate information systems. Since the pharma sector is so regulated, having better-documented processes, along with auditing of how they are carried out, helps with compliance issues.

Process management systems can also provide significantly improved levels of management, collaboration, and timeliness for clinical research studies.

For example: The tracking of clinical trials and investigations, including the number of patients seen and whether patient reports meet industry standards and research protocol.

Deloitte’s recent mid-market technology trends report shows that nearly 40% of executives expect the most significant productivity gains will come from investments in cloud infrastructure. This applies as much to the pharmaceutical industry as anywhere because the scalability and agility that a cloud BPM solution offers can help pharma companies with their R&D, clinical research, and cost savings.

Uncovering The Potential Value In Pharma Business Processes

Challenges facing the pharmaceutical industry and the solutions offered by process management systems

R&D Challenge: Preventing “merger devaluation syndrome” while staying competitive with double-digit top-line growth. Solution: As highlighted, R&D is a fundamental value driver. By reviewing processes, you can form multidisciplinary teams within your organization, with representation from all areas of the value chain. This process overview enables you to develop an innovative transformation program that incorporates newly designed processes and tools, new ways of working, a consolidated IT infrastructure and an outsourcing strategy. This way, you can better identify and resolve development resource issues, reduce cycle times, improve cost-effectiveness and raise customer satisfaction without sacrificing quality.

Product Development Challenge: To create fast, highest quality clinical value net worth, and increase productivity and reduce cycle time. Solution: By optimizing processes and tools through cross-functional teams structured to address the various components of the drug development value chain, you can develop innovative process enhancements and synchronized technologies globally.

Challenge: Knowledge management and collaboration can be ineffective as the pharma industry has a natural tendency to limit the sharing of information and is traditionally secretive. Solution: By implementing data and knowledge management, solutions can significantly improve collaboration both internally (locally and globally) and with external partners. For better effectiveness, technology must be used in tandem with processes and organizational cultural practices that foster collaboration.

Challenge: Unclear portfolio priorities and targets, when coupled with uninformed decision-making, can prove very costly in the pharma R&D processes. Solution: To significantly increase its ability to grow revenue, a company can implement solutions that facilitate real-time decision-making and handle complex and miscellaneous data across the value chain.

Signavio, The Cloud, And Pharma Return On Investment (ROI)

The financial benefits of harnessing process management in the pharmaceutical industry

Signavio is the intelligent guardian for your operational health, and through the Process Transformation Suite, pharma companies can develop a single source of truth and an integrated network that makes collaboration on a global scale easier. This collaboration can cross different IT architectures or any ERP system, including SAP®, which has the added benefit of making networks more scalable.

Cloud-based IT infrastructure can also enable rapid computing for different types of data and systems from the physical network across all nodes of the pharmaceutical supply chain.

For example: Hosted workspaces can modernize IT infrastructure, without adding significant capital expenditure. Pharma companies can work to customize and implement a secure and effective cloud-based enterprise quality management (EQM) strategy.

Let’s not forget that today's pharmaceutical environment requires the tripling of effort to improve process efficiency and effectiveness for positive financial change. Industry leaders looking to grow revenue and decrease costs are increasingly using process management systems to hit their goals. In fact, according to Gartner, 80% of enterprises harnessing BPM will experience an internal rate of return better than 15%!

Capitalizing on process management in the pharmaceutical industry is the shot of adrenaline needed to ensure industry stability today, and success tomorrow.

* Read our accompanying blog post and download our extensive content on the innovative use of process management in global healthcare.

Signavio: A Process A Day Keeps The Doctor Away

Process management in the pharmaceutical industry

Learn how Signavio can improve the failing health of the pharmaceutical industry with SAP Signavio Process Transformation Suite. Unleash process management in the pharmaceutical industry! Try it for yourself by registering now for a free 30-day trial.


Published on: September 25th 2018 - Last modified: November 13th, 2020