A presentation prepared by me, summarizing a healthcare white paper published by Grail Research on their website.

1. SUMMARY OF WHITE PAPER BY GRAIL
RESEARCH
APRAJAY MINOCHA
MBA Marketing from JIIT

2.  The “rule book” for success in healthcare had been relatively
stable for several decades – new product innovation coupled
with aggressive marketing
 However, the market is changing, pharmaceutical sales growth is
down, fewer NMEs are being approved and media spending has
seen significant cuts
 Recent deals between traditional healthcare players like Bayer,
Merck, Dr. Reddy’s etc and new entrants like Costco, Nintendo,
Fujifilm etc herald a fundamental shift in healthcare industry

3.  Today, major healthcare players face “common threats” like
patent expiration, generic threats, increasing role of payors in
decision making and relatively uninspiring pipelines
 New trends, including the rising prominence of consumerism,
information technology and the rising threat of Biosimilars are also
being experienced.
 In combination, these factors are challenging the healthcare
players to look outside the industry for ways to further innovate
and remain competitive.

4. NEW TRENDS
CONSUMERISM
• 70 % of consumers seek
health information on
the internet
• Many health-based
website seeing double-
digit growth in unique
visitors
HEALTHCARE IT
• Heavy investment in
Healthcare IT by
governments of various
countries.
• Healthcare IT market
expected to exceed $
162 billion with a CAGR
of 10.2 %
BIOSIMILARS
THREAT
• Increasing threat of
biosimilars due to
expiring patents
• The global financial
crisis is increasing the
pressure for
healthcare systems to
cut costs

5. Diversification Expertise Scale

6. Pfizer acquired
Wyeth for $ 68
billion in 2009
Novartis
acquired Alcon
for $ 51.6 billion
in 2011
Roche acquired
Genentech for $
46.8 billion in
2009

7. •Nintendo and Bayer
Partnership
•June 2009
•Developed Bayer’s
DIDGET blood glucose
monitoring system,
which plugs into
Nintendo DS. Targeted
at diabetic kids.
•Fujifilm’s acquisition of
Sonosite
•March 2012
•Sonsosite is a leader
in bedside ultrasound,
UHF micro-ultrasound
technology &
impedance
cardiography
equipment.
•Samsung’s $ 300
million JV with Biogen
Idec for biosimilars
development.
•Dec 2011
•85% JV owned by
Samsung
•Biogen will provide its
expertise in protein
engineering and
biological
manufacturing.

8. IMMEDIATE FACTORS
Biosimilars Boom
By 2015, sales of
biosimilars expected to
reach USD 1.9-2.6 billion,
from $ 378 million in first
half of 2011
Technology and
Consumerism
Consumer-friendly
technologies
Customer base and
distribution channels

9. New Players Seek Growth
• New players seek to tap the huge
potential of healthcare industry, a $
5.4 trillion market (7.7% of GDP).
• New players can leverage their
technology and expertise which is
required to remain competitive in
today’s healthcare market.
• Example: Fujifilm’s JV with Dr
Reddy’s will help to establish a strong
presence in the Japanese
pharmaceutical market
Healthcare Players Seek
Leverage
• Existing healthcare players want to
leverage others’ technology,
manufacturing skills etc as they face
cost constraints in the current
economic market.
• Example: Allscripts and
Etransmedia’s partnership with
Costco, provides them access to
Costco’s customer base as a
distribution channel.

10.  Entry of new players in the healthcare industry, is a sign of
changing healthcare landscape.
 In this changing landscape, the advantages of incumbency are
offset by new challenges, and the non-healthcare focused
companies now see a chance to enter an industry, which
traditionally has been a closed one.
 The pace and magnitude of change in the healthcare industry
has accelerated in the recent years. Companies are struggling to
meet the demands for innovation and change.
 These demands come at a time when intense financial pressures
are bogging down healthcare companies.

11.  Many of these demands, in order to be fulfilled, require
companies to participate in a market of products and services
that is outside of their historical zone.
 The current trend of new players entering healthcare industry will
continue, leading to a wide range of cross-industry
collaborations and deals.